Bank loans to SME under EFG

After reaching to its peak in 2009 the SME loans have started to decline. It’s a continues 2nd fiscal year when a decline has been noted in the loan arrangements.
The quarter one of financial year 2011 has marked a decline of further 11% from previous quarter. The fall is notes as £103 million to just £ 92 million in this quarter. These loans were offered under the Enterprise Financial Guarantee (EFG) scheme, initiated by government to boost the SME sector in the country. The report for the slump was declared by the British Bank Aldermore.
The scheme was initiated to reduce the credit crunch in the economy.

Decline since 2009
The last peak was in the second quarter of 2009, since there is a continues fall in the lending. Lending under this scheme is just 36% of what was two years back and 49% as compared to last year.
This scheme was seen as a very powerful tool to overcome the credit crunch in the economy. But unfortunately it has failed to fulfil the aim for which it was started.

Government’s initiative for the scheme
Prime minister of United Kingdom has
The Prime Minister recently decided to re-emphasis on the scheme and will try to build trust between the big banks of the nation and the small business seeking investments. The scheme will be revamped keeping in mind the needs of the business and the banks. The thoughts have been on reducing the instalments lot so that it can encourage the small business enterprises to opt for the loans under this scheme.