Opposition leader Tony Abbott and Shadow Small Business Minister Bruce Billson, have both called for an official inquiry into restrictions on small business financing.
Tony Abbott has claimed that large numbers of small businesses are being denied capital because the banks are refusing to lend on reasonable terms to good businesses.
“I know that the banks have got to be secure, I know that the banks have got to be careful of risky lending,” he said. “But there are enormous numbers of small businesses . . . who are effectively being denied capital because the banks are refusing to lend on reasonable terms to good businesses that have been their customers for a long time.”
His comments have angered The Australian Bankers Association, with chief executive David Bell claiming that it was a “falsehood to say that banks aren’t lending to small business”.
He said lending to small businesses (loans less than $2 million) was only slightly down this year, from a peak of $203.4 billion in September last year to $200.6 billion, and much of the fall appeared to be as a result of debt reduction.
Small Business Minister Bruce Billson said the inquiry will attempt to discover what businesses have been experiencing in regards to finance restrictions, why business lending has so many restrictions and what needs to be done to ensure lending is increased.
