Barclays rejects small business lending targets

The boss of Barclays' small business division has refused to agree to any government move which sets targets for the amount of money lent to small firms.

In an interview with the Financial Times, Steve Cooper said such a move could encourage irresponsible lending with banks agreeing to loans based on targets rather than the merit of a business' application.

"I'm not going to sign up to a target," he told the newspaper. "I don't want to create an expectation that if Barclays said no on Thursday it could say yes on Friday [because it has a target to achieve]."

The comments come as ministers discuss ways to increase access to finance for small and medium sized businesses. Targets, which have already been imposed on Lloyds and Royal Bank of Scotland in which the government has a shareholding, are one of several options. The Department for Business is also looking into boosting venture capital and business angel investments. No decision has yet been made.

Business groups have been critical of the banks' small business lending but executives and the British Bankers Association claim all efforts are being made to lend. 

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