BBA release SME lending data for 120 postcode areas

The BBA has published data showing small and medium-sized business (SME) borrowing and saving, broken down by each of Britain’s 120 Postcode Areas. Using data from the main high street banks, these figures highlight for the first time the regional geography of SME borrowing and saving in Britain.

The data shows that the majority of regions are net depositors, with SMEs in London, the South East, East Midlands, the East of England, Yorkshire and Humberside, the North East, the North West and Scotland having more on deposit than they are borrowing.

It also shows that the areas that need finance most are getting more funding.  In all regions outside London, the South East and the East of England bank finance to SMEs is greater as a proportion of total lending than their regional share of SME turnover. For example, the South West accounts for five percent of SME business activity in the UK but receives 11 percent of SME lending, Wales accounts for two percent of business activity and receives five percent of SME lending and the North West accounts for eight percent of business activity but receives 11 percent of SME lending.

The UK’s main banks through the Business Finance Taskforce wanted to broaden the statistics on lending available with particular focus on publishing national and regional data on the provision of bank support to SMEs.

The publication of regional data will provide greater transparency, helping the Government and businesses to understand the borrowing landscape for SMEs across the UK, thus contributing to better evidence-based policy making.

BBA Chief Executive Anthony Browne says we know that in these difficult economic times many businesses are building up large cash reserves and paying down debts rather than take on more borrowing: “That is why the majority of regions are net depositors saving more money than they are borrowing.

“The UK’s banks are working hard to restore business confidence through initiatives such as building a UK-wide network of business mentors, offering an independently-monitored appeals process for businesses whose borrowing applications have been declined, and working with alternative finance providers to provide access to different products.”