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Bank lending on the rise since its 2008 crash, finally!

Bank lending on the rise since its 2008 crash, finally!

In 2008, bank lending to businesses peaked at £575bn, however has declined year-on-year since. Never the less, in a strange turn of events, the extra £4.3bn of lending offered in the beginning of 2015 indicates a potential rise of 0.25% this year, even following a dramatic net plummet in June after big businesses paid off debts. In the first half of 2015, businesses borrowed £103bn from banks, up 19% from last year at just £88.6bn during the same period; don’t forget that the total stock of loans to firms is still well down on the 2008 peak.

Boosting Business investment is an essential factor in restoring the countries shaky productivity record and putting economic recovery on a sustainable footing.

Lending is finally on the up as banks are regaining their strength and businesses are set to increase their investment by 6.5% over the next three years, whilst Ernst & Young (EY) predicts economy growth of 2.5% per year over the three years. However, Britain’s banks have been severely reprimanded following the 2008 crisis for being too willing to lend to property markets and far too cautious when lending to businesses.

EY has said that lending levels, although on the rise, will still not have fully recovered by 2019. A whole 11 years after the crisis struck. Omar Ali, EY’s head of banking and capital markets, has said that the banking sector is still extremely vulnerable to future squeezes in interest rates, which is good news for the consumer, but not what the banks were hoping for.

EY has also predicted a modest rise in mortgage lending of 3.8% per annum on average, as house prices continue to rise.

Small businesses are becoming increasingly confident in the economic recovery as domestic demand for their goods grows.

This allows us Excel-A-Rate Business Services Limited to enable your business to keep up or exceed the estimated growth rate of the country. Allowing your business to increase in size and grow at a sustainable rate. We offer a range of financing options that we can accommodate to your needs whether it’s a lease, hire purchase or short term advance we can be your one stop shop to help your business stay on track.

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