Nearly a quarter of commercial finance brokers working in the Asset Finance sector surveyed by United Trust Bank expect that, over the next 12 months, it will become more difficult for SMEs to secure funding for growth.
The results of the survey, carried out by United Trust Bank and which received over 300 responses, are at odds with UTB’s own experience which has seen business volumes increase this year and has received a strong level of new enquiries from brokers representing SMEs since the Brexit referendum result was announced.
The survey also found that 31% of Asset Finance brokers believe that the rate of businesses failing will also increase.
Which of the following would you agree is likely to happen over the next 12 months?
SMEs will find it harder to borrow money for growth – 24%
SMEs will find it easier to borrow money for growth – 16%
SMEs will find the availability of funding similar to how it is now – 60%
The rate of businesses failing will increase – 31%
The rate of businesses failing will decrease – 5%
The rate of businesses failing will remain broadly the same – 64%
However, more than half (56%) of brokers working in the fields of asset, bridging, mortgage and development finance are positive about the UK’s future outside of the European Union.
The findings of UTB’s Broker Mini Poll are being revealed soon after the Federation of Small Businesses (FSB) published the results of its own survey of over 1000 SMEs. Their survey found that the number of small and medium sized businesses which were pessimistic about the future was higher than the number which were optimistic. It’s the first time since 2012 that the overall mood of SMEs taking part in the survey has switched to negative.
The FSB research included some positives though with 55% of SMEs aspiring to grow over the next year.
Martin Nixon, head of asset finance, United Trust Bank, said: “Our previous polls indicated that just over half of finance brokers (51%) were pro-Brexit and a slightly greater number (56%) are feeling positive about a future outside of the EU.
“However, it’s unsurprising that the uncertainty which remains about the timing and longer term implications of the Brexit are still worrying a large number of SMEs. As a funder with a strong appetite to support UK businesses, we can’t stress enough how keen we are to hear from brokers looking to source competitive and flexible funding for their clients from an experienced asset finance lender.
“Although we continue to grow our business volumes, recently joining the Bank of England’s Funding for Lending Scheme (FLS) has given us an additional source of funds and enabled us to pass on the benefits of some very competitive rates to assist qualifying SMEs in raising finance.
“I believe that more needs to be done to raise awareness amongst SMEs of the various funding options now available to them. The FLA and NACFB continue to try to get the message across to business owners but there does seem to be a gap between those SMEs which need funding but don’t know where to look and those funders with the money and the desire to lend it.
“I expect many of those SMEs with a slightly negative view of what the next 12 months might bring may also be those which feel that raising finance is also going to be a challenge.
“Funders like UTB, which look at each case on its own merits and offer bespoke and flexible solutions based on the suitability of the asset rather than just the company balance sheet, can fund or refinance a wide variety of assets for all manner of businesses whether long established or relatively young. And, as we continue to develop our BDM coverage across the UK and extend the range of assets we’ll consider, we look forward to supporting a growing number of brokers and their customers in the future.”