Business banking moving online

20 July 2006
According to the British Bankers' Association (BBA), the main banks serving Britain's Small and Medium-Sized Enterprises (SMEs) report that nearly half (42.5 per cent) of all transactions are completed via the internet.

The growth of lending for SMEs in the UK is showing a steady increase overall. More and more applications for business loans are being completed online, fuelling, and financing, the entrepreneurial spirit gripping the nation.

Although term lending for SMEs rose by ten per cent over the 2005/6 financial year to £34 billion, this was a slight decline in growth from the 18 per cent record of the previous year.

However, overdraft lending and deposits both rose by eight per cent across the same period, prompting BBA chief executive Ian Mullen to commend business lenders and banks for their contribution to this vibrant economic sector.

"With more than half a million new banking relationships being established in the last twelve months and a significant proportion of all businesses now banking online, the banks' effective support for the small business sector is clear," he said.

"While deposit and overdraft growth are both around eight per cent per annum, the moderation in growth in term lending is noteworthy and suggests that small firms are settling down to a more sustainable level of borrowing."

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