Target Group: Funding for Lending successes underline need for diverse lending environment
Ian Larkin, Co-Group CEO, Target Group has responded to the Bank of England’s (BoE) release of Funding for Lending figures for Q4 2015.
Larkin notes that there are ‘many positives’ to be taken from today’s statistics, and states that the Bank is achieving its aim of higher net lending to SMEs due to the upsurge in lending brought about by the Funding for Lending scheme.
Alongside this success, Larkin explains that there is a responsibility on the part of the BoE to ‘support a diverse lending environment that is fair to non-traditional lenders – like P2P and specialist lenders…’.
Ian Larkin, Co-Group CEO, Target Group said:
“There are many positives in the Bank of England 2015 Q4 usage and lending data. Growth in net lending to SME’s is the fundamental objective of the FLS Extension and the data indicates that the scheme is succeeding. We also see growth in the participation of non-traditional lenders as encouraging because more competition will benefit SME’s.
“With only two years to run on the FLS, attention turns to how the Bank of England winds down the scheme. Falling wholesale funding costs are helpful albeit a trend that has recently reversed. Our view is that the Bank of England needs to support a diverse lending environment that is fair to non-traditional lenders – like P2P lenders and specialist lenders – who are seeking to expand their participation in SME lending.
“Not doing so could risk entrenching the high market share of established players at the expense of new outfits, who bring added innovation in what I hope historians see as a transformational time for the market.”