Credit: Just what is going on?

So just who is telling the truth on credit availability?

The FICO/EFMA European Credit Risk Outlook report, released yesterday, shows that a “credit gap” looms for small European businesses in 2012.

Looking over the next six months, 31 per cent of respondents in the FICO/EFMA report forecast that the aggregate amount of credit requested by small businesses will increase, while just 13 per cent say the amount of credit extended will increase.

That is the widest credit gap for small businesses in the past 12 months.

In most European countries, it seems that the economic climate is going to shrink consumers’ and small businesses’ demand for credit.

But according to FICO, supply of credit will continue to fall faster than demand.

Contrast the findings of that report with the party line from the British Bankers Association.

"SMEs are paying back more than the new borrowing they are taking. Deposits held on accounts are also higher than loans outstanding. All of this means that, while banks have funds to lend, demand for business credit is low."

So there you have it. Banks claim that demand for credit is low so that they may not meet their Merlin lending targets; small firms say they are struggling to access finance.

The chances are that both supply and demand of credit are both in decline. But crucially, the supply of credit is shrinking faster than the demand for loans. We all know what will mean for any chance of economic growth. As for any prospect of a fall in unemployment if things remain as they are: forget it.

Photograph: Getty Images

Douglas Blakey is the editor of Retail Banker International

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Jeremy Corbyn's Labour conference speech shows how he's grown

The leader's confident address will have impressed even his fiercest foes. 

It is not just Jeremy Corbyn’s mandate that has been improved by his re-election. The Labour leader’s conference speech was, by some distance, the best he has delivered. He spoke with far greater confidence, clarity and energy than previously. From its self-deprecating opening onwards ("Virgin Trains assure me there are 800 empty seats") we saw a leader improved in almost every respect. 

Even Corbyn’s firecest foes will have found less to take issue with than they may have anticipated. He avoided picking a fight on Trident (unlike last year), delivered his most forceful condemnation of anti-Semitism (“an evil”) and, with the exception of the Iraq war, avoided attacks on New Labour’s record. The video which preceded his arrival, and highlighted achievements from the Blair-Brown years, was another olive branch. But deselection, which Corbyn again refused to denounce, will remain a running sore (MPs alleged that Hillsborough campaigner Sheila Coleman, who introduced Corbyn, is seeking to deselect Louise Ellman and backed the rival TUSC last May).

Corbyn is frequently charged with lacking policies. But his lengthy address contained several new ones: the removal of the cap on council borrowing (allowing an extra 60,000 houses to be built), a ban on arms sales to abusive regimes and an arts pupil premium in every primary school.

On policy, Corbyn frequently resembles Ed Miliband in his more radical moments, unrestrained by Ed Balls and other shadow cabinet members. He promised £500bn of infrastructure investment (spread over a decade with £150bn from the private sector), “a real living wage”, the renationalisation of the railways, rent controls and a ban on zero-hours contracts.

Labour’s greatest divisions are not over policy but rules, strategy and culture. Corbyn’s opponents will charge him with doing far too little to appeal to the unconverted - Conservative voters most of all. But he spoke with greater conviction than before of preparing for a general election (acknowledging that Labour faced an arithmetical “mountain”) and successfully delivered the attack lines he has often shunned.

“Even Theresa May gets it, that people want change,” he said. “That’s why she stood on the steps of Downing Street and talked about the inequalities and burning injustices in today’s Britain. She promised a country: ‘that works not for a privileged few but for every one of us’. But even if she manages to talk the talk, she can’t walk the walk. This isn’t a new government, it’s David Cameron’s government repackaged with progressive slogans but with a new harsh right-wing edge, taking the country backwards and dithering before the historic challenges of Brexit.”

After a second landslide victory, Corbyn is, for now, unassailable. Many MPs, having voted no confidence in him, will never serve on the frontbench. But an increasing number, recognising Corbyn’s immovability, speak once again of seeking to “make it work”. For all the ructions of this summer, Corbyn’s speech will have helped to persuade them that they can.

George Eaton is political editor of the New Statesman.