ABSTRACT
Credit relations are a central theme in post-Keynesian thought to which Victoria Chick has contributed in numerous writings.2 And as she has worked on the financing of small businesses in particular, it seemed appropriate to use the present occasion to say something about an important determinant of credit relations in the small-firm sector, namely the procedures that banks use to assess smallfirm loan applications. Whereas such assessments were once the preserve of largely autonomous local or regional branch managers, the last decade or so has seen a strong movement towards the centralisation and automation of lending decisions. The transition is now so advanced that the relationship managers who serve as banks’ points of contact with small-firm clients, often have little or no discretion over whether an application is granted. What follows considers some implications of this shift for small-firm borrowing, drawing on a series of interviews conducted with the major UK clearing banks in 1995.
