Firms dip into £1.5m loan fund

A NOT-for-profit business support agency which runs a £1.5 million loan fund has seen applications from small businesses in the Capital increase due to the credit crunch.

DSL Business Finance said it has issued a total of £178,000 of loans to small and start-up firms since it expanded to Edinburgh in May. It said that firms are turning to it because lending from mainstream banks has dried up.

DSL can give loans of up to £50,000 to small and start-up businesses, charities and social enterprises.

Eunice Lancaster, the general manager, said: "We are seeing a big increase in the number of small firms coming to us for financial assistance because the banks just aren't lending to them.

"They are victims of the credit crunch and many have nowhere else to turn."