Although companies are confident of their ability to access bank lending, the Times newspaper reports the SME Finance Monitor as saying that directors of small businesses increasingly prefer to operate “under their own steam”. The quarterly research found that 36{06aeb1921e0b802d2bd9c766bc98fb11cc6a46c2b0593ed9c88a0e29cf417a34} of companies used external finance in the period covering April to June, down from 44{06aeb1921e0b802d2bd9c766bc98fb11cc6a46c2b0593ed9c88a0e29cf417a34} four years ago. Almost half of businesses described themselves as “permanent non-borrowers”, meaning that they have no intention of raising external finance. Three quarters of small businesses said that they were willing to accept a lower growth rate rather than borrow to expand more rapidly.

George Nikolaidis, senior economist at EFF, is quoted as saying: “We should not be complacent about this lingering reluctance to access bank debt. It could mean that businesses are not getting all the ammunition they need to invest and realise their full growth potential.”