14-03-2013

A disconsolate Mike Benson has taken his complaint to the very top, after writing to the head of the Bank of England, Sir Mervyn King, about his inability to find a modest loan to buy a new Ford Transit for his business.

And to the astonishment of the would-be new van owner, Sir Mervyn replied with a sympathetic letter about the behaviour of the UK’s banks.

The letter read: “I was sorry to read of the difficulty you have experienced in trying to replace your Transit van. I can fully understand how that, and the behaviour you described from the banks you have spoken to, must have been.”

Sir Mervyn then went on to suggest that Mr Benson should try one of the UK’s new ‘challenger banks’, such as the Swedish firm Handelsbanken.

It seems a little bit of attention from the top goes a long way and Mr Benson was delighted with the response he received, which showed that King appreciated just how maddening the behaviour of the banks can be.

The main source of the annoyance for both parties is that Mike Benson’s business is exactly the type of business banks should be happy to lend to.

For the past 15 years, his business, which supplies parts for air compressors as far afield as the US, Chile and the Marshall Islands, has been quietly profitable. Businesses of this kind need support if the UK is to return to a state of economic growth.

Despite the fact that Mr Benson’s is a profitable business, when he approached the Bank of Scotland for a £10,000 loan towards the cost of a new £17,000 Transit, he was declined, with the bank citing the reason for the refusal as a lack of sufficient assets to act as security, should he default on the loan.

The Bank of Scotland then went to compound Mr Benson’s mood further, by offering a free business mentor instead.

“I thought that was sweet, but also quite patronising,” said 65 year-old Mike. “To offer counselling to someone who has running a profitable business for this long, and at my age!”