The Confederation of British Industry and Andrew Tyrie have called on the Bank of England to review funding for Small and Medium Enterprise. The chairman of the Treasury Select Committee wrote a letter to Mervyn King, Governor of the Bank of England urging him to look at the difficulties in funding within the banking system, which could have serious implications for small business finance.

The letter from Andrew Tyrie MP said:

“I am writing on behalf of the Treasury Select Committee to seek reassurance that you are examining carefully the effects that some of the post-crisis regulatory action and the market responses to it, in particular respect to bank liquidity.”

Tyrie also expressed his wish for the Financial Policy Committee to examine the situation carefully. During a press conference question and answer session John Cridland, the director general of the Confederation of British Industry, stated that in order to help businesses that were finding it difficult to gain access to credit, the government would have to consider “unconventional measures”. During the press conference, Cridland said:

“The reasonable expectations we had in the early part of the year for growth have been disappointing, governments need to do more when private sector has to do less, this is particularly relevant to the credit issue.”

According to Cridland, the government have started to introduce “unconventional measures” as they can see that difficulties with the banking market could exacerbate problems for small businesses that are looking for business funding.

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Gary Fields

Content Writer working alongside our expert accountants to bring you the latest Tax and Accounting news.

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