1. Market Research
  2. > Financial Services
  3. > Banking Market Trends

Unsecured Loans to Business in the UK - Key Trends and Opportunities to 2019

  • July 2015
  • 70 pages
  • Timetric
Report ID: 3149317

Summary

Table of Contents

Search Inside

Synopsis
The main theme throughout the review period was new lending recovering and growing substantially in the latter years - 13.4% thought 2014 - but the outstanding stock of business lending continued to fall due even sharper growth in repayments, which reached 15.3% in 2014 from 2013.

Summary
Net lending to small and medium-sized businesses was positive during four of the six months to March 2015, increasing by 1% from December 2014, while net lending to large businesses increased almost by 2% during the three months to March 2015. Gross lending to all businesses has registered growth since the start of 2013, mainly due to an increase in the availability of credit. Outstanding lending declined during 2014, despite increased gross lending, due to a substantial growth in repayments: 15%, 13% and 22% for small, medium-sized and large business respectively.

Interest rates remain at a historic low, and have been falling consistently since the Bank of England cut the central bank rate to 0.5% in 2009. The Bank for England’s quarterly Credit Conditions survey found that lending rates to small businesses remained broadly unchanged during the first quarter of 2015, while respondents indicated that rates had fallen significantly for medium-sized and large businesses.

The government has made several attempts to reinvigorate business lending over the last couple of years, however its projects have failed to have the desired effect. The flagship Funding for Lending scheme (FLS) began slowly and fell short of its initial GBP80 billion target by GBP20 billion in 2012. However, improvements have been made seen since 2014, and a substantial increase in the money lent through the FLS directly led to both outstanding stock for small and medium enterprises (SMEs) and new term lending to large business increasing. Project Merlin – the Government’s agreement with the ‘big four’ banks to increase lending to small businesses – fell GBP1.1 billion shy of its initial target.

The rise of the emergency 0.5% bank rate is set to make access to credit more expensive for banks, and subsequently, for businesses. With banks already wary of lending to smaller businesses, this may result in a decline in loan approvals, while businesses themselves are likely to be deterred by the prospect of more expensive loans. The Office for Budget Responsibility (OBR) altered its forecast in March 2015 and anticipates the rise to occur in mid-2016, as opposed to later this year. This gives banks and businesses extra time to prepare for the additional costs while the economy grows.

The industry is dominated by mainstream banks, with the ‘big four’ of Royal Bank of Scotland, Lloyds, Barclays and HSBC controlling over 80% of the market. Regulations and high costs make it a difficult industry to enter. Therefore, any real competition is sparse, although peer-to-peer lending has risen sharply over the last few years – it almost doubled in 2013 – after offering smaller businesses a viable alternative if bank loans are unavailable or too expensive.

Scope
- This report provides market analysis, information and insights into the UK business lending industry.

- It provides a breakdown of the types of business loans in the UK.

- It analyses drivers and the outlook for the market .

- It provides information on the main banks in the UK market.

- It covers news and regulatory developments.

Reasons To Buy
- Gain an understanding of the UK business lending industry

- Access monthly and annual statistics on every aspect of the market, both in written form and in graphs and tables.

- Read analysis of the relevant market statistics, detailing what has been happening in the lending to business market for both SMEs and large businesses, why it has been happening, and what to expect in the coming years.

- Read about the economic factors impacting the market.

- Read about how individual banks and building societies are affecting the market, in terms of market share and innovation.

Key Highlights
The stock of lending to businesses suffered greatly during the financial crash and has been in constant decline since. Strong growth in repayments, due to companies' increased fear of debt has been the main factor, but improving economic conditions make growth likely over the forecast period.

Get Industry Insights. Simply.

  • Latest reports & slideshows with insights from top research analysts
  • 60 Million searchable statistics with tables, figures & datasets
  • More than 25,000 trusted sources
  • Single User License — provides access to the report by one individual.
  • Department License — allows you to share the report with up to 5 users
  • Site License — allows the report to be shared amongst all employees in a defined country
  • Corporate License — allows for complete access, globally.

Ahmad helps you find the right report:

Testimonials

The research specialist advised us on the best content for our needs and provided a great report and follow-up, thanks very much we shall look at ReportLinker in the future.

Kate Merrick

Global Marketing Manager at
Eurotherm by Schneider Electric

We were impressed with the support that ReportLinker’s research specialists’ team provided. The report we purchased was useful and provided exactly what we want.

Category Manager at
Ikea

ReportLinker gave access to reliable and useful data while avoiding dispersing resources and spending too much time on unnecessary research.

Executive Director at
PwC Advisory

The customer service was fast, responsive, and 100% professional in all my dealings (...) If we have more research needs, I'll certainly prioritize working with ReportLinker!

Scott Griffith

Vice President Marketing at
Maurice Sporting Goods

The research specialist provided prompt, helpful instructions for accessing ReportLinker's product. He also followed up to make sure everything went smoothly and to ensure an easy transition to the next stage of my research

Jessica P Huffman

Research Associate at
American Transportation Research Institute

Excellent customer service. Very responsive and fast.

Director, Corporate Strategy at
Ingredion

I reached out to ReportLinker for a detailed market study on the Air Treatment industry. The quality of the report, the research specialist’s willingness to solve my queries exceeded my expectations. I would definitely recommend ReportLinker for in-depth industry information.

Mariana Mendoza

Global Platform Senior Manager at
Whirlpool Corporation

Thanks! I like what you've provided and will certainly come back if I need to do further research works.

Bee Hin Png

CEO at
LDR Pte Ltd

The research specialist advised us on the best content for our needs and provided a great report and follow-up, thanks very much we shall look at ReportLinker in the future.

Kate Merrick

Global Marketing Manager at
Eurotherm by Schneider Electric

Purchase Reports From Reputable Market Research Publishers

IDC MaturityScape Benchmark: Omni-Experience Digital Transformation in Retail Banking in Asia/Pacific, 2017

  • $ 4500
  • Industry report
  • June 2017
  • by IDC

This study presents the results of IDC Financial Insights' 2017 Omni-Experience Digital Transformation in Retail Banking in the Asia/Pacific MaturityScape Benchmark Survey. This study should be viewed ...

IDC PeerScape: Best Early Steps in Deploying Open Banking Application Programming Interface in Asia/Pacific

  • $ 4500
  • Industry report
  • June 2017
  • by IDC

In the context of how API readiness will most likely be a years-long program of work, we write this second report in our series on open banking API to present a list of best practices that banks can follow. ...

U.S. Banking Digital Transformation Spending Forecast, 2017-2020

  • $ 4500
  • Industry report
  • June 2017
  • by IDC

It's a case of two teams building a tunnel through a mountain, each starting at the opposite end and hoping they meet perfectly in the middle. In Perspective: Data and Risk Management Uniting Business ...


ref:plp2015

Reportlinker.com © Copyright 2017. All rights reserved.

ReportLinker simplifies how Analysts and Decision Makers get industry data for their business.