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SME finance is still a difficult ask

Why will our high street banks not step up and help?


Small businesses have very few choices for working capital. There are 6 million small businesses in the UK. Less than one per cent are funded by our high street banks.


For Small Business, it is the Alternative Finance lenders that fill the void. Low borrowing rates do not exist for small businesses. We have seen clients offered interest rates ranging from 10% to 100% per annum with requests for director guarantees, additional collateral and debentures on the business.


The other option is to focus on the trading performance of the business to ensure you are maximising your available resources. This is a longer process than borrowing, but ultimately much cheaper and builds stronger foundations in the business. We work with clients to allow them to set direction and show leadership particularly in cost reduction. This creates a culture of cost optimisation where the whole business takes ownership for costs and management incentivise continuous improvement within the business.


Until our high street banks start to provide meaningful interactions with small business owners, it is the Alternative Finance Lenders that will be cashing in on our local small business community.


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