The latest figures from the Bank of England (BoE) show lending to small and medium businesses (SMEs) increased £238m between May and June 2013.
This represents the largest increase since records began in April 2011, and the first month-on-month rise in SME lending since February 2013. The increase brings the total borrowed by SMEs in June 2013 to £170.4bn.
However, lending to non-financial businesses – a category including the majority of SMEs – contracted by £1.3bn during the same period, with overall lending down by 3% compared to June 2012.
The government has sought to boost lending with the Funding for Lending Scheme (FLS), run jointly with the Bank of England since July 2012.
The FLS is intended to support business lending by offering banks cheap finance if they pass savings on to customers and, since its revamp in April, gives banks greater incentives to lend to small and medium-sized businesses.
However, figures for the first quarter of 2013 showed net lending had fallen by £300m despite the launch of the scheme.
Last week the government announced that UK lenders will publish the lending data for 10,000 postcodes by the end of the year.
Seven of the UK’s banks and building societies, which account for 80% of the current stock of lending, have agreed to release the data to identify areas where action is required to boost access to finance.
The data will be published by the British Bankers’ Association (BBA) and the Council of Mortgage Lenders on a quarterly basis.