Borrowing blow hits Britain's van drivers
By Kyle Lindsay
Friday, August 1, 2014 - 16:06
A risky venture?
It is estimated that Britain’s van drivers contribute more than £43 billion to the UK economy.
Despite this, research has revealed that nearly 60% of SME van drivers are being turned down for loans by banks.
Despite the promise of providing a significant boost to the country’s economy, with two thirds of SMEs expecting to grow within the next 12 months, a 58% majority are still seeing their applications for funding turned down by high street lenders.
The Bank of England believes lending to SMEs is more risky by its nature and requires higher capital to guard against bad loans. By contrast, figures from the bank’s industry body showed SMEs repaid £5.2bn of existing loans in the first three months of 2014 and were holding £138.1bn in cash – a 9% rise year on year and sign of strong economic recovery amongst this sector.
To this end, and to add support SMEs, Mercedes-Benz Vans has taken the decision to create a new SME-focused National Business Development team to help with all aspects of buying, owning and running a van.
Steve Bridge, Managing Director, Mercedes-Benz Vans, said: “It is staggering that while business van drivers contribute almost £44 billion to the UK economy, and make up of around 10% of the country’s total employment, their significant contribution to the economy is almost certainly forgotten when it comes to Britain’s banks.
“In order to ensure these businesses grow, whether they are sole traders or SME’s, high street lenders need to wise up and give back to such an important part of the economy.”