View from small business on bank lending

The government has introduced a £20bn scheme aimed at boosting bank lending to small and medium-sized enterprises (SMEs).

The National Loan Guarantee Scheme is open to businesses with an annual turnover of up to £50m.

They will be able to apply for loans with interest rates one percentage point lower than those available outside the initiative.

Here, three SME owners describe their experiences with banks.

Jamie Russell, Edinburgh

Further smoke screen! How transparent are these initiatives in terms of results?

My business was declared insolvent two months ago. After 10 years of business banking with my bank they couldn't even manage to close the business account properly, which in turn meant charges kept coming off, which then had interest added.

This was going on for two months before any contact was made with us. Now it is being investigated by the bank as we complained.

Four months until there is a result. Interest will continue to accrue on the "debt".

Banks are not interested in helping business... they just want to cash in where they can to make a quick buck!

I would love to see exactly how these funds are distributed and what the criteria for funding are, and Key Performance Indicators (KPIs) measured on the outcomes.

Chris Nicholaidis, Tyne and Wear

The current state of banks and their treatment of small businesses is disgusting.

We opened an account with one of the main banks and it took them three months to give us a debit card. We work online and almost all payments are carried out online, so without the debit card, the account was useless.

We then approached them for a loan to expand - we sent our very healthy profit and loss statements and also the business plan. After four weeks, we have had no response.

We have tried to reach the person handling it three times and three messages have been left for that person by three other members of his team and nothing.

So during the time that's critical for us to expand to take advantage of an emerging market, this bank has left us hanging in the wind, without even an answer. I find it disgusting.

This is the usual treatment small businesses get from banks and this is the reason our economy is the way it is and why other countries do not want to do business with the British any more.

Stephen Baxter, East Kilbride

It is small businesses about to start up that need investment and these are the ones that seem to be turned down by the bank. A few years ago, I approached about five of the top High Street banks and I didn't get a positive response.

The main reason I was turned down for loans is not because I didn't have a good business plan, bad credit rating or no experience - all are good - but because I had no assets.

I have done business in the past, but put money in myself - I was successful in doing this, but if I only put a small amount of my own money in, I can only ever employ one person.

Now I want to get in to the automotive trade - it is a big venture and therefore I need big investment.

I think banks should show more entrepreneurial thought by lending money more easily to smaller businesses to reinvent companies, allowing the UK to compete and engage with China.