There are signs that the credit crunch may have become less severe for some businesses, according to the latest CBI figures.

There are signs that the credit crunch may have become less severe for some businesses, according to the latest CBI figures published on Saturday 4 April.

Firms were less negative in the March CBI Access to Finance Survey than they were in February about the availability of new and existing credit over the previous three months.

For new credit, the net percentage of firms saying availability had deteriorated in the past three months was a balance of -36 per cent, compared with -59 per cent in February. For existing credit, the balance was -16 per cent compared with -25 per cent.

Ian McCafferty, the CBI's chief economic adviser, said: 'Fewer firms said in March that the availability of credit had got worse for them in the past three months than did so in February or January. The view that the pace of deterioration is easing correlates with what businesses are starting to tell us on the ground.

'Firms are not saying that credit conditions are getting better, but the severity of the disruption is no longer worsening as sharply as it was three months ago. And the combination of easier monetary policy and the government's measures to support the banking sector may be starting to have an impact.'

Numbers of companies expecting conditions to worsen in the next three months fell back a little in March, with a balance of -36 per cent slightly better than -38 per cent the previous month.

Firms said the cost of finance continued to rise and access to trade credit insurance has worsened over the past three months.

The survey contains a range of other findings about the availability of finance.

Nearly half of firms (46 per cent) say they have cut staff numbers over the past three months as a result of the credit crunch, a slight increase on February's figure (40 per cent). Staff hours have stabilised, even though output is still coming down, and firms are cutting back on training budgets and capital investment.

For the third month running, the very largest firms, employing over 5,000 staff, were most widely affected. Most of the companies in this size bracket (86 per cent) that had sought new finance said that its availability had got worse in the last three months. This was the case for just 15 per cent of large businesses and 54 per cent of small and medium-sized companies (SMEs).

In the next three months, just under a third of the very largest firms (29 per cent) expect that access to new credit will get worse, which is the case for just over a third of large firms (36 per cent) and SMEs (38 per cent).

The cost of existing finance has become more of a concern in March. Just over a third of firms said the cost of existing finance had risen in the past three months compared with just over a quarter in February.

Problems with the availability of trade credit insurance have intensified. Nearly half (48 per cent) of firms surveyed said they use the insurance to cover the supply of goods to customers. Of these, nearly three-quarters (72 per cent) said its availability had worsened in the past three months, hindering their ability to secure contracts.