The latest figures revealed that in the quarter ending 30 June 2013, 18 banks and building societies completed £2 billion worth of drawdowns through FLS.

Despite the increases, net lending through the scheme since beginning in June 2012 is down £2.1 billion, with the total amount drawn from FLS now at £17.6 billion.

The aim of the FLS is to encourage more lending to the UK economy than would have been the case in the absence of the Scheme, despite this, the Bank described lending in the second quarter as “broadly flat”.

Industry favourite, Aldermore Bank, stamped its name on proceedings, proving that Britain’s challenger banks are increasingly becoming a source of credit for businesses, after drawing down a total of £485 million since the scheme began, the ninth largest in the UK.

On the other hand, Barclays efforts have dramatically decreased, despite being the top investor in the scheme – lending out £6 billion, twice that of Lloyds Banking Group.  According to the figures, Barclays, alongside Lloyds, has become completely self-sufficient, with the bank deciding not to draw down on the scheme in the last two quarters.

Paul Fisher, executive director for markets at the BoE, said: “The FLS is continuing to support lending to the UK economy with a range of indicators suggesting that credit conditions are steadily improving for households and firms, and FLS participants collectively expect net lending volumes to pick up over the remainder of this year.”

Speaking on the figures, David Brown, Commercial Director of LSL Property Services, said: “Last August the entire economy was on shaky ground.  While the foundations of today’s recovery could be more solid still, there are encouraging signs for the housing market, and some clear benefits of Funding for Lending for a wave of aspiring homeowners.  Resultant cheaper mortgage rates for first-time buyers, alongside the first stage of Help to Buy, have made home-ownership possible for thousands.  Their dreams might otherwise have been dashed. Thankfully, they aren’t the victims of an extended credit crunch.”

“But there’s other good news too – more affordable finance for landlords is having a real effect in the private rented sector.  More supply of rental properties has been made possible by better access to buy-to-let mortgage finance.  That’s already having an impact on more affordable rent rises, amid an unprecedented surge in demand.  Admittedly, lower savings rates are one obstacle for potential first-time buyers, making raising a deposit even harder.  In this respect Funding for Lending has been less helpful.  However – the main result is a healthier housing market.  And that renewed optimism is already an important incentive for the supply of more, better-quality homes.  We’re seeing a stronger purchase market, rented market – and the entire UK economy is on a better footing.  That’s good news for everybody, from landlords, to tenants, to first-time buyers.”

Also speaking on the announcement, Paul Hunt, managing director of Phoebus Software, said: “The Funding for Lending scheme has underpinned the housing market over the past year and has provided strong foundations for growth. Gross mortgage lending has improved across the spectrum and figures confirm the housing market is stable. Mortgage lenders’ progressive attitude has helped boost the market as their willingness to lend through the provision of innovative products is helping first time buyers. In particular banks have used the Funding for Lending scheme to allow more competitive mortgage rates and by providing higher loan to value mortgages which has resulted in a significant jump in first time buyers loans recently. The revival in first time buyer numbers demonstrates not only the underlying buyer demand, but that lenders have pushed the market forward to unlock this demand. Further relief for banks and building societies has been found in the scheme, as it has provided lenders with the means to drive growth in mortgage lending.”