Bosses are being forced to make business loans on their credit cards because bankers are still refusing to lend them money.
Six out of 10 firms were turned down for bank loans last year, according to a survey by the Institute of Directors (IoD), the Daily Mail reports.
The cut off of credit is despite assurances by Gordon Brown and Chancellor Alistair Darling banks would be forced to start lending again following a £850bn Government stimulus package.
IoD director general Miles Templeman says: 'The fact more than half of all businesses seeking finance last year were turned away by their banks is totally incompatible with the banking sector's position on the state of lending in the UK.
'What is even more concerning is that having been rejected, 83% of businesses are not receiving information about alternatives available to them, including the Government's Enterprise Finance Guarantee. Full story...
BUILDING SOCIETIES could go to the wall amid a "life-threatening" fight for savers' money as banks start to payback state aid, the Telegraph reports.
The warning from Moody's follows concern last week from mortgage lenders facing a shortfall of more than £300bn when banks start repaying emergency government finance.
The ratings agency said this would force some building societies to merge or seek a buyer as funding from savers dried up.
"Last week, the Council of Mortgage Lenders (CML) warned removal of government support for the industry will choke off lending and consumers would face even less and more expensive funding," Moody's said in its latest comment on the mortgage lending industry.
"We believe that as the UK government gradually disentangles itself from the extraordinary support of the banking system, many of the smaller lenders will have to either consolidate with stronger entities or be at the risk of break-up or distressed exchanges," it added. Full story...
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