Barclays has stopped offering asset finance to firms with turnover of less than £5 million a year, according to The Times. Give us news, not history, some might say! The pullout from the key area of small business lending comes in the wake of promises to the government that Barclays would boost loans to small firms. The Times reports that the decision means Barclays is, “potentially withdrawing credit to tens of thousands of business clients”.
One such SME refused finance by Barclays is Reliant Colour Solutions, a business customer of Barclays for 29 years, owned by Ian Lewis. HSBC Holdings and Close Brothers have already presented offers to Lewis (and good for them), but when invited to submit their offer, Barclays declined.
When Barclays Corporate hit back they started by saying that Barclays Business discontinued asset finance products for SME customers last year, and not last week. Their defence is that the withdrawl of one product from the market cannot be viewed as depriving businesses access to credit when there are many other suitable alternatives available.
In fact, they reminded us, half of unsecured lending to SMEs is for the purpose of purchasing an asset, and Barclays Business offers a number of alternative options to help them do this including term loans, overdrafts and EFG.
Source: Leasing World Magazine
