For the first time since January, net lending to businesses has increased, signifying that confidence is rising due to renewed economic growth throughout the United Kingdom.

According to the British Bankers’ Association (BBA), net borrowing by companies operating outside of the financial sector grew £172 million in June, relative to the £2.7bn net repayment in May. In the same analysis, the BBA also showed that the amount of home mortgages soared to the highest level in 17 months.

"Second quarter gross domestic product is expected to have strengthened and as economic conditions improve the banks are providing the finance to help growth,” states BBA statistics director David Dooks.

The data likely indicates that the Bank of England and the treasury’s Funding for Lending Scheme (FLS) may be beginning to provide a boost to the economy. The programme was extended in April and modified to encourage lending to small business.

Though businesses have started to borrow more, data has also shown that many small and medium businesses are saving more than they borrow. The data was collected from banks including HSBC, Barclays, Lloyds, and RBS (Royal Bank of Scotland).

However, in Wales, business borrowing came in higher than deposits, at about £1.2 billion.

"In these difficult economic times many businesses are building up large cash reserves and paying down debts rather than take on more borrowing,” explains Anthony Browne, BBA chief executive.

The government and financial institutions hope to rebuild business confidence even further and encourage more borrowing through a nationwide network of business mentors, initiatives, independently monitored appeals processes, and other programmes.