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MP slams banks for failing to support local businesses

January 19, 2011 9:07 AM

Tim with local resident outside RBS bank in KendalSouth Lakes MP Tim Farron has spent much of the last two weeks meeting with local businesses to discuss issues and challenges surrounding the national and local economies.

Having met with representatives from a range of businesses in the South Lakes - including Mintcake makers, builders, pre-school operators, farmers and even marine technology consultants - Tim has confirmed that by far the biggest challenge facing local companies today is the appalling lack of support from the banks. Many highly successful businesses rely on small loans to cover short-term cash flow issues, but since 2008 the banks have become scared and are reluctant to provide access to these essential loans at reasonable interest rates despite the vast sums of money provided by the Government to ensure that the banks remain solvent.

Commenting, Tim said: "This obstinate refusal to provide loans to businesses that are very obviously profitable is completely unacceptable. All of the banks in the UK are propped up by the taxpayer, regardless of whether they were bailed out or not. I think they should recognise that they have a moral obligation to help get the economy running smoothly again, and that includes offering these loans at reasonable rates."

Tim is meeting the Deputy Prime Minster Nick Clegg this week to ask for more action to force the banks to support local businesses.