7th August 2012
In the current climate, the need to take out a loan to finance a business or for personal reasons is as great as ever. However, with many banks reluctant to lend to people looking to invest in businesses or simply trying to pay for car repairs or other emergency situations, both personal and business finances have taken a real hit. People who are struggling to pay off mortgages are seeking help with dealing with debt from payplan rather than turning to banks for help because they may fear getting the cold shoulder, while some businesses also feel that they can go elsewhere for debt advice.
Banks including the Royal Bank of Scotland have admitted that they have let people down when it comes to helping them with loans, overdrafts and other vital services. This has made trying to meet the cost of personal and business essentials hugely difficult. The business world in particular has been affected adversely by banks' reluctance to lend, as many smaller companies are reliant on loans to help them meet the cost of overheads such as heating and lighting.
Without the ability to take loans out, many small businesses that rely on loans for starting up, paying off suppliers and for investing in new technology are left with nowhere to go. This can be hugely distressing for small and medium-sized business owners everywhere if they know of the difficulties in getting a loan. However, recent stories such as the Libor scandal and pressure from the government may make it a little easier to take out a loan, whether it's for a mortgage or for a move to a new office.