Bolton and the Missing Link

: a banker's analysis of the lending relationship with small businesses

Abstract

The relationship between the small businessman and the bank manager can be of considerable importance to the success or otherwise of his/her business. That relationship exists, and develops, directly as a result of the circumstances which surround and impact upon it: and the interaction and ability of the individual parties to the relationship.

The understanding of the relationship is developed by the author reviewing the literature with the benefit of his 30 years banking experience. From this review critical issues within the relationship are identified, examined and tested by a field survey and case study. The analysis of the empirical research, along with that of the literature review, is then used to identify a single issue which appears crucial to improving the relationship for both the small business owner and lending banker.

The conclusions of this research indicate that in order for there to be a more successful relationship there needs to be co-ordinated education and training for both bank managers and small business owners. This, in time, should lead to the bank relying less on security to reduce its risks and more on the projected cashflow and profits of the business to ensure repayment of any borrowing.

Date of Award	Mar 2001
Original language	English
Awarding Institution	Aston University