Small Business Support - May & June 20111
22/09/2011

There are an estimated 484,000 term loans (within some 3.9 million small business banking relationships) with a total outstanding value of £37.1bn, whilst overdraft borrowing stands at £7.1bn.

BBA statistics director, David Dooks, said of the data:

"The average monthly value of new term lending in the first half of this year, of £500mn a month, is only slightly lower than throughout 2010, but net lending has contracted more (£332mn a month) than last year. This reflects the appetite of small businesses to pay down their borrowings and, in an uncertain environment, with trading confidence fragile, build up cash reserves. The average monthly rise in deposits (£473mn a month) is significantly higher than in any year since the financial crisis, generating a record level of £58bn".

Please read the full release via the link below.

Notes to Editors

1. Contributors to this survey are Barclays, Clydesdale (including Yorkshire Bank), HSBC, Lloyds Banking Group (including HBOS), Royal Bank of Scotland (including NatWest), Santander UK (including Alliance & Leicester) and The Co-operative Bank.

2. Small businesses are defined here as those commercial businesses with an annual bank account debit turnover of up to £1 million. Although clubs, charities and societies operate small business accounts with banks, their activities are not commercial in nature and are therefore not covered by these data.

3. Net changes are adjusted where appropriate to remove the effects of reporting discontinuities or coverage breaks, thus reflecting underlying business movements.

4. The BBA provides practical help and advice for small businesses, including a business account finder, in a Small Business Policy Issues Section of our website (www.bba.org.uk).

5. The Office for National Statistics applies a Standard Industrial Classification (SIC) within the UK National Accounts and the Bank of England does likewise for banking statistics. The SIC is defined by EU regulations and revised periodically to reflect changes in the profile of European residents’ activities - the latest classification was adopted in UK banks’ reporting in January 2011. As banks revised the SIC codes applied to their business customer accounts, they also reviewed the customer base generating these data. Across almost 4 million small business customers, correcting/updating codes and reviewing coverage resulted in some discontinuities in data for the month of January and for the month of February, hence combined data series in some cases for those two months. After this break in series, some 3.9 million businesses fell into the ‘small’ business segmentation, ie with debit turnover of up to £1million.

6. Banks’ work on systems for business size segmentation at operational customer level has meant that the customer base for businesses with up to £1m debit turnover continues to be refreshed as they gear up to expanding the industry datasets as part of the Business Finance Taskforce initiatives (see www.betterbusinessfinance.co.uk for information). The stock levels at end-April are not therefore directly comparable with stock levels say a year ago (eg, a business originally categorized as a small business based on turnover under £1m may have grown over time beyond that segment). Any figure quoted for annual growth is compiled on the basis of measuring consistent, like-for-like business segments and will therefore differ from a simple comparison of current stock levels with previously published levels.

7. This release brings the compilation of these data series, covering the support of small businesses with turnover up to £1m turnover, to a close. They are being superseded by new industry datasets for Small and Medium-sized Enterprises with up to £25m turnover (within which both small and medium-sized business segments will be available) to provide a wider perspective on the banks’ support for UK SMEs.