8 May 2014
A new report from the Enterprise Research Centre (ERC) sheds more light on ‘discouraged borrowers’ – a previously under-explored group of SMEs who choose not to seek bank finance because they believe they will be unsuccessful. The report, ‘Back to Borrowing? Perspectives on the ‘Arc of Discouragement’, identifies a group of around 173,000 small business which are discouraged borrowers (about 4% of all firms). The report advocates six steps that banks, Government and others should take to encourage an extra 123,000 of these SMEs to apply for bank finance – two thirds of which the ERC estimates could be successful.