Incentivising Lending to SMEs with the Funding for Lending Scheme: Some Evidence from Bank-level Data in the United Kingdom
This study explores the effectiveness of the incentive mechanisms embedded within the UK's Funding for Lending Scheme (FLS) for banks' to expand their supply of lending to medium sized enterprises (SMEs). The FLS was announced by the Bank of England and HM Treasury in June 2012, with the a...
Gespeichert in:
| 1. Verfasser: | |
|---|---|
| Format: | Elektronisch E-Book |
| Sprache: | English |
| Veröffentlicht: |
Paris
OECD Publishing
2016
|
| Schriftenreihe: | OECD Economics Department Working Papers
|
| Schlagworte: | |
| Online-Zugang: | kostenfrei |
| Zusammenfassung: | This study explores the effectiveness of the incentive mechanisms embedded within the UK's Funding for Lending Scheme (FLS) for banks' to expand their supply of lending to medium sized enterprises (SMEs). The FLS was announced by the Bank of England and HM Treasury in June 2012, with the aim of improving the supply of credit to the UK real economy. Despite the prevailing low level of risk-free interest rates, UK banks' funding costs were elevated at the time of the Scheme's introduction, and the intention was to provide lenders with a stable source of lower-cost funding to support credit provision to the real economy. The Scheme's design built in direct incentives for banks to support lending to the real economy, by linking both the price and quantity of funding available through the Scheme to their lending performance. This paper looks for evidence of the effectiveness of these incentives, exploiting a modification of the Scheme's design for its extension in April 2013 to help identify changes in credit supply from credit demand. Specifically, the change sharpened incentives to lend to SMEs, relative to larger ones. This facilitates using a difference-in-difference approach, exploiting bank-level data on UK banking groups, to look for a direct impact of incentives on credit supply, considering larger companies as a control group. On the basis of the available dataset, it is not possible to identify that this change in the incentive structure of the FLS directly boosted loan growth to SMEs, relative to large firms, between the extension of the Scheme and the end of 2013. The results seem robust to using different metrics of credit supply. However, the dataset is unavoidably small, both in terms of number of lenders covered and the length of the period after the modification of the design. More generally, reductions in lenders' market funding costs since the FLS' introduction may have lessened banks' incentives to use draw on the Scheme, and so the impact of incentives within it |
| Beschreibung: | 1 Online-Ressource (16 Seiten) |
| DOI: | 10.1787/a4352865-en |
Internformat
MARC
| LEADER | 00000nam a2200000zc 4500 | ||
|---|---|---|---|
| 001 | BV047936446 | ||
| 003 | DE-604 | ||
| 007 | cr|uuu---uuuuu | ||
| 008 | 220413s2016 xx o|||| 00||| eng d | ||
| 024 | 7 | |a 10.1787/a4352865-en |2 doi | |
| 035 | |a (ZDB-13-SOC)061252999 | ||
| 035 | |a (OCoLC)1312712333 | ||
| 035 | |a (DE-599)BVBBV047936446 | ||
| 040 | |a DE-604 |b ger |e aacr | ||
| 041 | 0 | |a eng | |
| 049 | |a DE-384 |a DE-91 |a DE-473 |a DE-824 |a DE-29 |a DE-739 |a DE-355 |a DE-20 |a DE-1028 |a DE-1049 |a DE-188 |a DE-521 |a DE-861 |a DE-898 |a DE-92 |a DE-573 |a DE-19 | ||
| 100 | 1 | |a Havrylchyk, Olena |e Verfasser |4 aut | |
| 245 | 1 | 0 | |a Incentivising Lending to SMEs with the Funding for Lending Scheme |b Some Evidence from Bank-level Data in the United Kingdom |c Olena Havrylchyk = Les mécanismes d'incitation au crédit aux PME dans le Funding for Lending Scheme : effet constaté à partir des données au niveau des banques au Royaume-Uni / Olena Havrylchyk |
| 246 | 1 | 3 | |a Les mécanismes d'incitation au crédit aux PME dans le Funding for Lending Scheme |
| 264 | 1 | |a Paris |b OECD Publishing |c 2016 | |
| 300 | |a 1 Online-Ressource (16 Seiten) | ||
| 336 | |b txt |2 rdacontent | ||
| 337 | |b c |2 rdamedia | ||
| 338 | |b cr |2 rdacarrier | ||
| 490 | 0 | |a OECD Economics Department Working Papers | |
| 520 | |a This study explores the effectiveness of the incentive mechanisms embedded within the UK's Funding for Lending Scheme (FLS) for banks' to expand their supply of lending to medium sized enterprises (SMEs). The FLS was announced by the Bank of England and HM Treasury in June 2012, with the aim of improving the supply of credit to the UK real economy. Despite the prevailing low level of risk-free interest rates, UK banks' funding costs were elevated at the time of the Scheme's introduction, and the intention was to provide lenders with a stable source of lower-cost funding to support credit provision to the real economy. The Scheme's design built in direct incentives for banks to support lending to the real economy, by linking both the price and quantity of funding available through the Scheme to their lending performance. | ||
| 520 | |a This paper looks for evidence of the effectiveness of these incentives, exploiting a modification of the Scheme's design for its extension in April 2013 to help identify changes in credit supply from credit demand. Specifically, the change sharpened incentives to lend to SMEs, relative to larger ones. This facilitates using a difference-in-difference approach, exploiting bank-level data on UK banking groups, to look for a direct impact of incentives on credit supply, considering larger companies as a control group. On the basis of the available dataset, it is not possible to identify that this change in the incentive structure of the FLS directly boosted loan growth to SMEs, relative to large firms, between the extension of the Scheme and the end of 2013. The results seem robust to using different metrics of credit supply. However, the dataset is unavoidably small, both in terms of number of lenders covered and the length of the period after the modification of the design. | ||
| 520 | |a More generally, reductions in lenders' market funding costs since the FLS' introduction may have lessened banks' incentives to use draw on the Scheme, and so the impact of incentives within it | ||
| 650 | 4 | |a Industry and Services | |
| 650 | 4 | |a United Kingdom | |
| 856 | 4 | 0 | |u https://doi.org/10.1787/a4352865-en |x Verlag |z kostenfrei |3 Volltext |
| 912 | |a ZDB-13-SOC | ||
| 943 | 1 | |a oai:aleph.bib-bvb.de:BVB01-033317940 | |
Datensatz im Suchindex
| _version_ | 1818806114014199808 |
|---|---|
| adam_text | |
| adam_txt | |
| any_adam_object | |
| any_adam_object_boolean | |
| author | Havrylchyk, Olena |
| author_facet | Havrylchyk, Olena |
| author_role | aut |
| author_sort | Havrylchyk, Olena |
| author_variant | o h oh |
| building | Verbundindex |
| bvnumber | BV047936446 |
| collection | ZDB-13-SOC |
| ctrlnum | (ZDB-13-SOC)061252999 (OCoLC)1312712333 (DE-599)BVBBV047936446 |
| discipline | Wirtschaftswissenschaften |
| discipline_str_mv | Wirtschaftswissenschaften |
| doi_str_mv | 10.1787/a4352865-en |
| format | Electronic eBook |
| fullrecord | <?xml version="1.0" encoding="UTF-8"?><collection xmlns="http://www.loc.gov/MARC21/slim"><record><leader>00000nam a2200000zc 4500</leader><controlfield tag="001">BV047936446</controlfield><controlfield tag="003">DE-604</controlfield><controlfield tag="007">cr|uuu---uuuuu</controlfield><controlfield tag="008">220413s2016 xx o|||| 00||| eng d</controlfield><datafield tag="024" ind1="7" ind2=" "><subfield code="a">10.1787/a4352865-en</subfield><subfield code="2">doi</subfield></datafield><datafield tag="035" ind1=" " ind2=" "><subfield code="a">(ZDB-13-SOC)061252999</subfield></datafield><datafield tag="035" ind1=" " ind2=" "><subfield code="a">(OCoLC)1312712333</subfield></datafield><datafield tag="035" ind1=" " ind2=" "><subfield code="a">(DE-599)BVBBV047936446</subfield></datafield><datafield tag="040" ind1=" " ind2=" "><subfield code="a">DE-604</subfield><subfield code="b">ger</subfield><subfield code="e">aacr</subfield></datafield><datafield tag="041" ind1="0" ind2=" "><subfield code="a">eng</subfield></datafield><datafield tag="049" ind1=" " ind2=" "><subfield code="a">DE-384</subfield><subfield code="a">DE-91</subfield><subfield code="a">DE-473</subfield><subfield code="a">DE-824</subfield><subfield code="a">DE-29</subfield><subfield code="a">DE-739</subfield><subfield code="a">DE-355</subfield><subfield code="a">DE-20</subfield><subfield code="a">DE-1028</subfield><subfield code="a">DE-1049</subfield><subfield code="a">DE-188</subfield><subfield code="a">DE-521</subfield><subfield code="a">DE-861</subfield><subfield code="a">DE-898</subfield><subfield code="a">DE-92</subfield><subfield code="a">DE-573</subfield><subfield code="a">DE-19</subfield></datafield><datafield tag="100" ind1="1" ind2=" "><subfield code="a">Havrylchyk, Olena</subfield><subfield code="e">Verfasser</subfield><subfield code="4">aut</subfield></datafield><datafield tag="245" ind1="1" ind2="0"><subfield code="a">Incentivising Lending to SMEs with the Funding for Lending Scheme</subfield><subfield code="b">Some Evidence from Bank-level Data in the United Kingdom</subfield><subfield code="c">Olena Havrylchyk = Les mécanismes d'incitation au crédit aux PME dans le Funding for Lending Scheme : effet constaté à partir des données au niveau des banques au Royaume-Uni / Olena Havrylchyk</subfield></datafield><datafield tag="246" ind1="1" ind2="3"><subfield code="a">Les mécanismes d'incitation au crédit aux PME dans le Funding for Lending Scheme</subfield></datafield><datafield tag="264" ind1=" " ind2="1"><subfield code="a">Paris</subfield><subfield code="b">OECD Publishing</subfield><subfield code="c">2016</subfield></datafield><datafield tag="300" ind1=" " ind2=" "><subfield code="a">1 Online-Ressource (16 Seiten)</subfield></datafield><datafield tag="336" ind1=" " ind2=" "><subfield code="b">txt</subfield><subfield code="2">rdacontent</subfield></datafield><datafield tag="337" ind1=" " ind2=" "><subfield code="b">c</subfield><subfield code="2">rdamedia</subfield></datafield><datafield tag="338" ind1=" " ind2=" "><subfield code="b">cr</subfield><subfield code="2">rdacarrier</subfield></datafield><datafield tag="490" ind1="0" ind2=" "><subfield code="a">OECD Economics Department Working Papers</subfield></datafield><datafield tag="520" ind1=" " ind2=" "><subfield code="a">This study explores the effectiveness of the incentive mechanisms embedded within the UK's Funding for Lending Scheme (FLS) for banks' to expand their supply of lending to medium sized enterprises (SMEs). The FLS was announced by the Bank of England and HM Treasury in June 2012, with the aim of improving the supply of credit to the UK real economy. Despite the prevailing low level of risk-free interest rates, UK banks' funding costs were elevated at the time of the Scheme's introduction, and the intention was to provide lenders with a stable source of lower-cost funding to support credit provision to the real economy. The Scheme's design built in direct incentives for banks to support lending to the real economy, by linking both the price and quantity of funding available through the Scheme to their lending performance.</subfield></datafield><datafield tag="520" ind1=" " ind2=" "><subfield code="a">This paper looks for evidence of the effectiveness of these incentives, exploiting a modification of the Scheme's design for its extension in April 2013 to help identify changes in credit supply from credit demand. Specifically, the change sharpened incentives to lend to SMEs, relative to larger ones. This facilitates using a difference-in-difference approach, exploiting bank-level data on UK banking groups, to look for a direct impact of incentives on credit supply, considering larger companies as a control group. On the basis of the available dataset, it is not possible to identify that this change in the incentive structure of the FLS directly boosted loan growth to SMEs, relative to large firms, between the extension of the Scheme and the end of 2013. The results seem robust to using different metrics of credit supply. However, the dataset is unavoidably small, both in terms of number of lenders covered and the length of the period after the modification of the design.</subfield></datafield><datafield tag="520" ind1=" " ind2=" "><subfield code="a">More generally, reductions in lenders' market funding costs since the FLS' introduction may have lessened banks' incentives to use draw on the Scheme, and so the impact of incentives within it</subfield></datafield><datafield tag="650" ind1=" " ind2="4"><subfield code="a">Industry and Services</subfield></datafield><datafield tag="650" ind1=" " ind2="4"><subfield code="a">United Kingdom</subfield></datafield><datafield tag="856" ind1="4" ind2="0"><subfield code="u">https://doi.org/10.1787/a4352865-en</subfield><subfield code="x">Verlag</subfield><subfield code="z">kostenfrei</subfield><subfield code="3">Volltext</subfield></datafield><datafield tag="912" ind1=" " ind2=" "><subfield code="a">ZDB-13-SOC</subfield></datafield><datafield tag="943" ind1="1" ind2=" "><subfield code="a">oai:aleph.bib-bvb.de:BVB01-033317940</subfield></datafield></record></collection> |
| id | DE-604.BV047936446 |
| illustrated | Not Illustrated |
| index_date | 2024-07-03T19:35:05Z |
| indexdate | 2024-12-18T19:04:37Z |
| institution | BVB |
| language | English |
| oai_aleph_id | oai:aleph.bib-bvb.de:BVB01-033317940 |
| oclc_num | 1312712333 |
| open_access_boolean | 1 |
| owner | DE-384 DE-91 DE-BY-TUM DE-473 DE-BY-UBG DE-824 DE-29 DE-739 DE-355 DE-BY-UBR DE-20 DE-1028 DE-1049 DE-188 DE-521 DE-861 DE-898 DE-BY-UBR DE-92 DE-573 DE-19 DE-BY-UBM |
| owner_facet | DE-384 DE-91 DE-BY-TUM DE-473 DE-BY-UBG DE-824 DE-29 DE-739 DE-355 DE-BY-UBR DE-20 DE-1028 DE-1049 DE-188 DE-521 DE-861 DE-898 DE-BY-UBR DE-92 DE-573 DE-19 DE-BY-UBM |
| physical | 1 Online-Ressource (16 Seiten) |
| psigel | ZDB-13-SOC |
| publishDate | 2016 |
| publishDateSearch | 2016 |
| publishDateSort | 2016 |
| publisher | OECD Publishing |
| record_format | marc |
| series2 | OECD Economics Department Working Papers |
| spelling | Havrylchyk, Olena Verfasser aut Incentivising Lending to SMEs with the Funding for Lending Scheme Some Evidence from Bank-level Data in the United Kingdom Olena Havrylchyk = Les mécanismes d'incitation au crédit aux PME dans le Funding for Lending Scheme : effet constaté à partir des données au niveau des banques au Royaume-Uni / Olena Havrylchyk Les mécanismes d'incitation au crédit aux PME dans le Funding for Lending Scheme Paris OECD Publishing 2016 1 Online-Ressource (16 Seiten) txt rdacontent c rdamedia cr rdacarrier OECD Economics Department Working Papers This study explores the effectiveness of the incentive mechanisms embedded within the UK's Funding for Lending Scheme (FLS) for banks' to expand their supply of lending to medium sized enterprises (SMEs). The FLS was announced by the Bank of England and HM Treasury in June 2012, with the aim of improving the supply of credit to the UK real economy. Despite the prevailing low level of risk-free interest rates, UK banks' funding costs were elevated at the time of the Scheme's introduction, and the intention was to provide lenders with a stable source of lower-cost funding to support credit provision to the real economy. The Scheme's design built in direct incentives for banks to support lending to the real economy, by linking both the price and quantity of funding available through the Scheme to their lending performance. This paper looks for evidence of the effectiveness of these incentives, exploiting a modification of the Scheme's design for its extension in April 2013 to help identify changes in credit supply from credit demand. Specifically, the change sharpened incentives to lend to SMEs, relative to larger ones. This facilitates using a difference-in-difference approach, exploiting bank-level data on UK banking groups, to look for a direct impact of incentives on credit supply, considering larger companies as a control group. On the basis of the available dataset, it is not possible to identify that this change in the incentive structure of the FLS directly boosted loan growth to SMEs, relative to large firms, between the extension of the Scheme and the end of 2013. The results seem robust to using different metrics of credit supply. However, the dataset is unavoidably small, both in terms of number of lenders covered and the length of the period after the modification of the design. More generally, reductions in lenders' market funding costs since the FLS' introduction may have lessened banks' incentives to use draw on the Scheme, and so the impact of incentives within it Industry and Services United Kingdom https://doi.org/10.1787/a4352865-en Verlag kostenfrei Volltext |
| spellingShingle | Havrylchyk, Olena Incentivising Lending to SMEs with the Funding for Lending Scheme Some Evidence from Bank-level Data in the United Kingdom Industry and Services United Kingdom |
| title | Incentivising Lending to SMEs with the Funding for Lending Scheme Some Evidence from Bank-level Data in the United Kingdom |
| title_alt | Les mécanismes d'incitation au crédit aux PME dans le Funding for Lending Scheme |
| title_auth | Incentivising Lending to SMEs with the Funding for Lending Scheme Some Evidence from Bank-level Data in the United Kingdom |
| title_exact_search | Incentivising Lending to SMEs with the Funding for Lending Scheme Some Evidence from Bank-level Data in the United Kingdom |
| title_exact_search_txtP | Incentivising Lending to SMEs with the Funding for Lending Scheme Some Evidence from Bank-level Data in the United Kingdom |
| title_full | Incentivising Lending to SMEs with the Funding for Lending Scheme Some Evidence from Bank-level Data in the United Kingdom Olena Havrylchyk = Les mécanismes d'incitation au crédit aux PME dans le Funding for Lending Scheme : effet constaté à partir des données au niveau des banques au Royaume-Uni / Olena Havrylchyk |
| title_fullStr | Incentivising Lending to SMEs with the Funding for Lending Scheme Some Evidence from Bank-level Data in the United Kingdom Olena Havrylchyk = Les mécanismes d'incitation au crédit aux PME dans le Funding for Lending Scheme : effet constaté à partir des données au niveau des banques au Royaume-Uni / Olena Havrylchyk |
| title_full_unstemmed | Incentivising Lending to SMEs with the Funding for Lending Scheme Some Evidence from Bank-level Data in the United Kingdom Olena Havrylchyk = Les mécanismes d'incitation au crédit aux PME dans le Funding for Lending Scheme : effet constaté à partir des données au niveau des banques au Royaume-Uni / Olena Havrylchyk |
| title_short | Incentivising Lending to SMEs with the Funding for Lending Scheme |
| title_sort | incentivising lending to smes with the funding for lending scheme some evidence from bank level data in the united kingdom |
| title_sub | Some Evidence from Bank-level Data in the United Kingdom |
| topic | Industry and Services United Kingdom |
| topic_facet | Industry and Services United Kingdom |
| url | https://doi.org/10.1787/a4352865-en |
| work_keys_str_mv | AT havrylchykolena incentivisinglendingtosmeswiththefundingforlendingschemesomeevidencefrombankleveldataintheunitedkingdom AT havrylchykolena lesmecanismesdincitationaucreditauxpmedanslefundingforlendingscheme |