Brexit could be bothersome for small businesses as it’s revealed 38% rely on EU funding
In the run up to Brexit, access to funding remains a worry for small firms - yet 20% remain unaware of the funding options available to them
As Britain’s withdrawal from the EU draws nearer, the country’s small and medium-sized businesses have expressed concerns over their ability to gain funding and insist that recent economic and political uncertainty is having an adverse affect on business confidence.
In a study conducted by Hiscox of 500 small businesses with fewer than 249 employees, 35% of those surveyed said they worried about a lack of funding options in the run up to Brexit.
This issue is particularly pressing as 38% of the 500 businesses surveyed said they rely on EU funding.
Alongside EU funding and equity funding (also received by 38% of businesses over the last five years), the majority of businesses (75%) surveyed revealed they had turned to banks for funding in the last five years – an interesting statistic given the rise in alternative finance such as crowdfunding and peer to peer loans since 2012.
In fact, 36% of the small business owners polled said a lack of choice was the single most common single challenge they faced when seeking funding, followed by a lack of eligibility for funding (28%), and yet 20% of the businesses surveyed said they were unaware of the variety of funding options on offer to them.
View Startups’ guide on the 10 ways to fund your business without a bank loan.
While the survey result highlighted an uncertain funding future for Britain’s small businesses, other factors influencing growth were also highlighted:
- 31% of businesses surveyed said economic uncertainty had been the biggest factor impacting their growth in the last five years.
- 10% of businesses noted that they face obstructions in growth due to a lack of skilled workers – a rising cause for concern as Brexit draws near.