Gross Lending To SMEs Drops In Q1 2020
According to the Business Finance Review published by UK Finance earlier this year, the amount of gross lending to SMEs (Small and Medium Sized Enterprises) fell to £5.6 billion in the first three months of this year when compared with the last three months of 2019 when the figure was £6.1 billion. That equates to a drop of 4.3%.
It is possibly not a surprise to see this happen especially bearing in mind that COVID-19 may well have had an impact on the figures. It will be interesting to look at the figures when they are published for the second quarter of 2020 as we may see lower figures due to the pandemic.
It will not come as a surprise to read that the area of the country where there was more gross lending made to SMEs was in London followed by the South East of the country.
In the first quarter of 2020, 54% of overdrafts were being utilised by SMEs that was the same as in the last quarter of 2019. Back in Q1 of 2019 the figure was 60% so there has been a slight fall of 6% in a twelve month period.
The number of loans and overdrafts approved in the first quarter of 2020 was 41.9% more than the last quarter of 2019. The sector that saw the biggest growth in such types of finance was in accommodation and food service that saw a rise of 74%.
There appears to be so much uncertainty here in the UK about how long COVID-19 will have an impact it will be very interesting to look at lending figures in the coming months. Just when things appeared to be improving there is further concern about a possible second wave of COVID-19. There has been and continues to be businesses both large and small from various sectors that have ceased to trade. We will continue to keep our readers updated.