Tenth of SMEs fold due to lack of funding
One in ten businesses which have struggled to access funding have ended up closing down, as the small- and medium-sized enterprise (SME) funding crisis continues.
According to new research by challenger bank Shawbrook, 72 per cent of UK SMEs have experienced difficulties accessing funding. Among this group, one in ten ultimately saw their businesses fold.
The research also found that 29 per cent of business owners had to delay significant investments in their business due to a lack of funding, while a further 29 per cent said they were unable to take advantage of investment opportunities to grow their business.
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Meanwhile, 28 per cent of SME owners decided not to invest in new technology or machinery, while 22 per cent were unable to hire more staff due to the challenges in accessing funding.
“It’s disheartening that so many businesses are folding when there are other options for them, so many could not only survive but go on to thrive,” said Neil Rudge, head of enterprise at Shawbrook.
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“While mainstream, traditional finance providers don’t offer the expertise or appetite to support these businesses, there are a plethora of specialist lenders who can help plug the funding gap.”
Shawbrook’s research also found that 58 per cent of SME leaders said that being able to access the right funding was one of their biggest concerns.
Almost seven in ten (67 per cent) respondents said that would be willing to pay more for a specialist lender that meets their requirements rather than applying for a high street bank loan.
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