Saturday, May 21, 2011

Richard Werner on 'Banking for the Big Society'

A new video interview on YouTube posted today Banking for the Big Society has Prof Werner explaining why the UK Coalition Government is having problems pursuading banks to lend to small and medium sized businesses. We get regular hand wringing from the highest level and now even threats. Prime Minister David Cameron  is reported by George Parker in the Financial Times (18th May) 'Cameron warns banks to lend more'  that if the banks don't keep to the Project Merlin deal of promising more lending they will face new taxes.

But Werner points out that the underlying problem in the UK is an extreme case of a mismatched banking market. In other major countries there is a much more appropriate sizing of banks to the credit need at the local level. Here is a chance for the Coalition Government to get real with its commitment to localism and release the potential of the Big Society by transforming the banking sector along Werner's lines:  Legislate for new independent local banks and encourage the expansion of Credit Unions.
posted by Charles Bazlinton. Buy the book The Free Lunch - Fairness with Freedom on Amazon

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