Banks: Don’t take No for an answer

Published: 12 March 2010
by PETER GRUNER

A SENIOR official from one of Britain’s high street banks has urged struggling traders in Islington  not to “lose heart” in the recession.

He spoke at a meeting  this week in Finsbury Park called by traders who complained that they were unable to get loans to keep businesses afloat.

Keiron Walsh, commercial manager with Lloyds TSB, said that while loans might be more difficult to obtain in the current climate it did not mean that funds were not available. Fashion traders in Fonthill Road pointed out that they were having to make staff redundant and were facing closure after the worst financial period in more than 30 years.

At the packed meeting in the offices of business forum FinFuture in Seven Sisters Road, traders explained that, despite being loyal customers of high street banks for many years, they were being refused essential loans – often on the basis of a financial risk score worked out on a computer.

Mr Walsh, from Lloyds TSB Commercial at Highbury Corner, said: “It’s important that traders establish a good relationship with their bank manager and provide a proper viable business case for the loan.

“If you are refused you can, of course, appeal to a more senior manager in the bank. 

“In other words, you don’t always have to take No for an answer.”

He added that his bank definitely wanted to help small firms as well as start-up businesses. 

“But we need to see a proper business plan and proof and information about current and future cash flow,” he said. “It goes without saying that banks don’t want to lose money in something that may turn out to be non-viable.”

The government is helping smaller businesses with an enterprise capital loan announced by Trade and Industry Secretary Lord Mandelson last year. The government provides 75 per cent security over bank loans of between £1,000 and £1million, which can be paid back over ten years.

George Barango, business adviser with Hackney-based HBV Enterprise, said his organisation will help people who are “disadvantaged” and who may have been refused by banks. 

Traders heard that financial help is also available from North London Enterprise Credit Union, where there are maximum loans of £10,000 for start-up companies.

Chairman of Fonthill Road Traders Association Selim Gozubuyuk­oglu said many of his business colleagues were struggling to buy new stock, and faced closure. 

“The meeting has been very useful,” he added. “As someone who has been turned down for a bank loan I discovered there are a lot of other avenues to explore.”