Banks continue to get more lending decisions right first time
Additional lending secured as a result of the process has reached at least £48 million over the past three and a half years, and almost 11,000 appeals have been received so far. These figures are encouraging to see, as more SMEs are securing the funding they need to take their business to the next level
The process has also had a significant impact on the way bank relationship managers work, and the level of dialogue they have with business owners. As Professor Griggs explains, declined applicants are getting increasingly detailed information on why their application has been turned down. This means that businesses can assess for themselves whether they should come back with a fresh application, consider a different bank finance product, or seek funding from a different provider entirely.
This extra support is clearly having an impact. The overturn rate – the number of lending decisions reversed – continues to fall, and this year almost 80% of small business finance application have been approved (according to the latest BDRC SME Finance Monitor).
As banks and businesses work together more closely and are more transparent about what makes a successful finance application, an increasing number of lending decisions being made are the right ones.
Irene Graham, Executive Director of Business Finance at the BBA