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ART has confirmed that it will have £1.6m available to lend in 2011-12. In all cases lending when a bank has been unable to help either in full or in part, ART offers loans of between £10,000 and £50,000 to small and medium sized businesses (SMEs) operating in Birmingham and Solihull.
ART is a Community Development Finance Institution, with a remit to support local jobs. It is supported by private companies and individuals, as well as local and national Government and European funding. Over the past 14 years, it has helped around 500 borrowers to start up, survive or grow. “We have lent more than £9m since we set up, to businesses operating in just about every sector,” says Steve Walker, Chief Executive of ART. “Our aim is to ensure that viable businesses in Birmingham and Solihull can access the finance they need.”
The current concern is that businesses are wary of getting into debt and lack the confidence to apply for loans. “Demand has been surprisingly low in Birmingham and Solihull,” says Steve. “Everywhere you turn small business owners are saying they can’t access finance, yet they do not appear to be applying for what is available.”
Steve believes that many small businesses are not aware of the all the options available to them. “The banks are no longer the primary source of finance for small businesses at start up level,” he says, “and there are many alternatives which can be used alone, or packaged together, to provide a tailored solution.” He worries that businesses are losing out by opting to use personal finance, such as credit cards, for business purposes. These are not only usually a far more expensive way to borrow money, but using them also cuts businesses off from specialist advice and support that could be of enormous benefit. “It’s that old problem,” he says, “you don’t know what you don’t know. Whereas if you speak to finance experts, like the team at ART, you’re quite likely to find they have a solution you haven’t thought of.”
ART takes a personal approach to assessing loan applications and the application process is straightforward. Money can be used for any business purpose – including to support cashflow – and made available quickly if necessary.
“We’re keen to see applications increase this year,” says Steve. “We don’t want any money remaining by April 2012 – we’d rather see businesses putting it to good use.”