THE availability of ready credit remains increasingly difficult to source, particularly for small businesses. But if you turn to car leasing, you can access a new line of credit without impacting access to working capital. Editor Ralph Morton explains.

CREDIT is remaining difficult to obtain. Earlier this year, the Federation of Small Businesses (FSB) reported that banks were still holding back funds from viable small businesses.

And in its most recent survey, the CBI said access to finance remained a serious problem for businesses. Although the CBI did note that the rate of deterioration in credit conditions had slowed.

Nevertheless, businesses owners turning to unsecured lending for their cars are only finding that rates have soared.

A Moneyfacts.co.uk survey found interest rates on unsecured loans had increased by much as 44% over the last two years – in some cases rising from 8.6% in May 2007, to 12.4% today. And all this despite bank base rates being at an all time low.

Car leasing, on the other hand, looks a much better option as an easier way to access funding for business cars.