Strong business plans 'vital' for small companies
Credit Review Office chief John Trethowan reiterated yesterday that the banks are "open for business" and are providing credit to small firms, but warned people applying for loans would have to provide detailed business plans.
"We have moved from 'relationship banking', where loans were approved by the local manager who usually had a personal relationship with the businessman, to 'process banking' where all applications go to head office for approval.
"In that environment it is vital that business owners can provide hard numbers on their business. An application will stand or fall on the basis of how viable the bank perceives a business is. The only way to prove that is with a strong business plan," he said.
But Liz Hughes, of the Association of Chartered Certified Accountants, called on the process to be as simple as possible: "We would ask that the scheme be simple, without the need for complex business plans or auditor certificates, as small business cannot afford to pay for these."