Government ‘may have to force banks to lend’
The Government may have to force banks to offer more loans and mortgages if the current situation continues, according to a leading economist.
Jonathan Loynes, Chief European Economist at Capital Economics, said: “[The government has] got to … encourage [banks] or perhaps even force them to actually lend … money into the wider economy so that households and companies can operate in a normal way.”
He added that reducing interest rates and increasing funds for loans were “all very well”, but said that promoting lending has to be a top priority.
Loans have been in relatively short supply in the past 18 months, as banks have experienced a combination of limited funds for loans and reduced confidence in lending.
A loans expert for Think Money said: “Loans are more difficult to come by than they were, perhaps, 18 months ago, but they are still very much available. We recommend people looking for a loan contact a loans adviser to improve their chances of finding the best deal.”
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