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SMEs have their say on funding


More than half of businesses (57%) are looking to reduce costs when it comes to reviewing their existing funding facilities, according to Hilton-Baird Financial Solutions’ latest SME Trends Index.

Those driven by reducing costs far outweighed those looking to secure additional funding (32%) and achieve greater flexibility (23%). A further 17% said that they look for better service from their funding provider when reviewing their facilities.

The annual research, which questioned business owners and finance directors on a range of issues, also discovered that exactly half turn to their current bank manager when searching for new funding. More than one in four rely on their in-house expertise, with only 19% using an accountant or IFA. Just 13% approach an independent finance broker.

Access to finance was a common theme throughout the survey, which saw 50% label the funding support that’s available to them from lenders and the government as inadequate. Only 27% believed it was sufficient.

Meanwhile, 16% of businesses have seen at least one funding application turned down in the past 12 months. However this was as high as 26% amongst businesses with a turnover of less than £500,000 as the country’s smallest businesses continue to struggle to secure the funding they require.

Commenting on the statistics, Evette Orams, Managing Director of Hilton-Baird Financial Solutions, said: “It is worrying that SMEs aren’t accessing the funding support they need. As the lifeblood of the economy, they are key to its recovery.

“Funding remains available to businesses of all sizes if they explore the right avenues, but it isn’t a one size fits all offering so care must be taken to ensure the right facility is secured.

“Solutions that provide the right level of service and support, plus the flexibility and headroom to grow in line with the business, can give SMEs the freedom to reach their potential. Whilst cost is of obvious importance, focusing instead on the value the facility would drive to the business is key.”

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