Responding to the Bank of England’s Monetary Policy Committee’s vote to cut the base rate to 4.5%, Federation of Small Businesses (FSB) Chair Martin McTague said:

“The cut in the base rate needs to be passed on by lenders to borrowers as rapidly as possible, to give small firms a bit of breathing space, and to enable more of them to think about growth and future plans, rather than just survival."

“With inflation at a manageable level, elevated rates are a barrier holding back economic growth. The start of a sustained reduction trajectory will help. Market expectations of further rate cuts in the year will be welcomed by small businesses who will look forward to reduced borrowing costs and more finance options being available to them."

“Ensuring that small businesses have access to the funding they need to invest and grow is a vital component of a healthy economy. Lower rates will play a huge role in unlocking expansion among small businesses, and we also want the Government to ensure that personal guarantees to limited company directors are properly regulated, so that what should be a business loan does not end up as a personal liability."

“In addition, lower rates on mortgages and personal finance products will give small business owners some much-needed financial headroom, while giving a fillip to consumer confidence, which will benefit customer-facing sectors such as retail and hospitality."

“A financial landscape that encourages small firms to take a chance on a new piece of equipment, bigger premises, or a training course to expand their skills is one that will help to deliver the economic growth that we all want and need to see as soon as possible.”