At last, a real alternative to the banks - European Commission initiative

THE European Commission has finally come to recognise the blindingly obvious: the EU’s banks are neither ready, willing nor able to become the engine for future economic growth.

Yesterday it launched an initiative to encourage non-bank lending across Europe in a bid to boost the overall economy, especially the small and medium-sized business sector.

European businesses are still suffering from the effects of the financial crisis largely due to a reluctance by banks to lend. At present, only 30% of lending to businesses in Europe comes from the non-banking sector, such as equity markets, compared to 70% in the United States.