Loans stepped to small UK construction firms to plug gap
£38m sent in 2015/16, up from £29.7m in 2013/14, said online finance market Funding Options, which surveyed electricians, plumbers, plasterers, carpenters, decorators, scaffolders and roofing businesses
The directors of small British construction businesses are lending them more money to plug a funding gap, as banks set tighter lending criteria and major contractors delay payments, a survey showed on Monday.
Directors lent companies £38 million ($50 million) in 2015/16, up from £29.7 million in 2013/14, said online finance market Funding Options, which surveyed electricians, plumbers, plasterers, carpenters, decorators, scaffolders and roofing businesses.
Banks have taken a more cautious approach on funding given a slowdown in UK property markets and tighter scrutiny from regulators, and are instead choosing to focus on larger players.
“Confronted by continued borrowing constraints and often faced by long waits for payment, they (directors) are ploughing significant amounts of their own money into their businesses to ensure they remain on a firm financial footing,” Funding Options CEO Conrad Ford said.
“But it is questionable whether taking such drastic personal measures is sustainable for much longer.”