Over a third of small and medium-sized retailers have seen lending costs rise despite the historically low base rate, according to data released by the British Retail Commission (BRC).

Of the small and medium-sized firm that reported a rise in the cost of lending more than 65% commented that it had undermined their ability to trade.

"The poor availability of bank credit is undermining stock levels and retail employment. We understand the banks' current cautious approach to lending, but there's no reason why they need to stop loans to fundamentally sound businesses," said Jane Milne, BRC business environment director.