Small business owners lend money to their own businesses

Small business owners have been drawing on their personal finances to keep their businesses afloat during the recession.

In fact, there was a rise in personal insolvencies in the first nine months of 2009, and experts believe many business owners have sacrified their perosnal finances in favour of their businesses.

Owners have been using their own credit cards, drawing on personal savings and using overdraft facilities to prevent their businesses going under.

Chris Poll, chief executive of CreditPal, said: "Thousands of small and medium-sized enterprises (SMEs) have been forced to rely on credit to survive in the last two years as a result of disruptions to business cashflow.

"We believe we have identified an SME fear factor at play, with companies more likely to seek finance from non-traditional sources because they are scared of even applying for finance from banks and building societies."

Incredible, isn't it?

The banks, who should be there to support our businesses - after all UK taxpayers now own most of the banks - are scaring off business owners, who have to dip into their pockets to keep their businesses going, while at the same time paying taxes to keep the banks who won't lend to them afloat.