The Federal Government have rejected a suggestion that they should guarantee loans for small businesses to foster growth in the sector.
Yet, the Federal Small Business Minister Bruce Billson questioned why access to finance remains a problem for small and medium enterprises (SMEs) and says lack of competition among banks is a contributing factor.
“We’ve asked the lenders ‘will this change your lending practices?’ and the answer we’ve got back is no,” he told media.
“The information we’ve had from the banks is that they don’t want to make a loan that has a risk of default even if somebody else might carry a portion of the cost of that default.”
Source: Herald Sun