SME confidence in banks still lagging in UK

A recent SME Finance Monitor survey, published by the Business Finance Task Force, revealed that British small and medium-sized enterprise (SME) owners saw their confidence in receiving bank loans increase in the fourth quarter of 2012 - to a still-woeful 43 percent.

"It's a play-it-safe kind of economy for small businesses," PayNet founder Bill Phelan recently told Reuters about lending in the United States. "They are not getting pulled in by the cheap credit and extra money floating around. They are continuing to hold back in investment growth."

The study, which polled members at more than 5,000 SMEs, revealed that nearly half of British businesses are expecting to expand within the next year - yet just 43 percent of respondents are confident in their firms' ability to secure loans from financial institutions. This represents the lowest mark since the fourth quarter of 2011, when only 33 percent of SME professionals were confident.

While bank lending continues to stagnate, many SMEs are still planning on growing. Others, are in a bit of financial trouble and will need funding to keep their heads above water.

This is where alternative short term lending can help tremendously. Many of these lenders use Payment Reporting Builds Credit scoring methods, making significantly more business owners eligible for loans than traditional credit scores would.