Bank relationships have been cited as an area of competitive weakness, but there has been improvement. Banks are making serious efforts to understand better the needs of smaller business customers. They have introduced voluntary codes of practice governing relations with SMEs. They have invested in staff training and have produced targeted material for customers. Some have offered inducements to SMEs to improve financial management.
Banks increasingly offer alternative kinds of finance.
Despite these improvements, some smaller firms remain critical of banks. 13.22 Business Links will play a part in informing businesses about the range and relative merits of different kinds of finance. They will deliver a new Government-funded service which will help growing businesses get access to the most appropriate finance package. Banks are being encouraged to refer customers to Business Links for information and counselling services. The Small Firms Loan Guarantee Scheme facilitates lending to companies who would not otherwise meet lenders' collateral or track-record requirements.