Most businesses in the UK are sufficiently in control of their finances to not require new debt, recent research has suggested.
The Institute of Chartered Accountants in England and Wales (ICAEW) recently surveyed some 1,000 companies to establish current
business banking requirements.
According to the findings, only one in five said they had needed to apply for new banking facilities during the last 12 months.
The group noted that most companies were finding alternative ways of managing their budgets, such as reducing working capital and implementing cost cutting measures.
Clive Lewis, head of enterprise at ICAEW, said this "good financial discipline" has been the main factor in the weak demand for business lending.
"Those that have applied have generally being accepted but are having to pay higher costs. This will be the norm as the cost of debt pre-recession was very cheap and I doubt we will see those levels again for a long time," he said.
Around two thirds of those companies surveyed did not feel increased business debt was necessary for their growth over the next two years.
