The Problem
Cash is oxygen and many small businesses are suffocated not for a lack of customers, but a lack of credit to serve their needs. Viable businesses have been going under or not taking off at all thanks to the stranglehold failed political banking policies have had on credit flow in the economy.
Lending to businesses has been decimated in recent years, silently killing the economy.
Old Politics Failure
Successive administrations have failed to either understand or care about the needs of businesses to access credit to survive and prosper. They have instead focused on pandering to other special interests without making provision for banks in particular to open the flood gates of credit to viable businesses.
Promises of expanded business credit have not materialised as more committees dither and plans languish while real businesses in the real world go to the wall, putting more people out of work and keeping them there.
The Solution
Aaron’s plan is to prioritise lending to viable businesses with a defined action plan to get credit rolling. State owned banks will be obliged to lend to businesses with a credible plan, just as they would have prudently done in the past. Managers who lend to successful businesses will be rewarded, and those who fail to lend to viable businesses that go to the wall can look for another profession.
Getting Credit Rolling
- Banks will be obliged to meet the targets already set and new ones for opening credit lines to viable businesses
- Review teams of commercial staff (not civil servants) will actively monitor and audit decisions
- Banking managers and teams who support successful businesses will be rewarded
- Those who fail consistently to lend to viable businesses will not have a future in banking