Political uncertainty could damage access to growth funding in 2018 say UK firms
Use of alternative finance options surging among younger business owners, but remains less popular with older entrepreneurs
Political and economic uncertainty could make access to vital growth finance more difficult over the coming year, according to UK businesses in a study commissioned by Worldpay.
More than 50% of the 1,000 small business owners surveyed had growth ambitions for 2018, but 52% claimed access to traditional routes to finance could be limited and 30% had already struggled to secure funding through these channels.
However, these businesses are increasingly seeing alternative options such as peer-to-peer lending, crowdfunding and business cash advances as viable routes for funding.
40% of younger business owners surveyed said they had become less reliant on banks for funding as a result of the growing alternative finance sector.
21% of businesses owners aged 44 or under said a bank loan was still their most likely option when looking for funding, while 17% preferred crowdfunding, 11% peer-to-peer lending, and 6% a business cash advance.
The study found that younger small business owners are far more likely to consider alternative finance routes in comparison with their older peers, who could leave themselves vulnerable if lending levels drop.
James Frost, CMO Worldpay UK, said: “Small businesses are the engine room of the British economy, so it’s very encouraging to see that so many of the UK’s entrepreneurs and independents are planning for growth.
“A lot of business owners will remember the credit crunch of 2008 and the difficulties they faced during that period. We’ve come a long way since then however, and today small business owners have an incredible number of options available to them in order to support growth.”