In support of small business advice week, ThinCats is urging business owners to take advantage of the UK’s growing community of professionals advising on alternative finance.
In research carried out by ThinCats, when asked about the type of company they had used to advise them on external funding, 30% of businesses stated they had never used an adviser.
Of those that did receive advice, 22% used an accountancy firm; 21% used a corporate finance adviser and 20% used a commercial finance broker.
Damon Walford, ThinCats chief development officer said: “Given the double whammy of a global economic slowdown and Brexit, it’s quite likely that banks will rein in their funding for SMEs even further.
“The good news is that there are alternative lenders like ThinCats with substantial funds to lend that simply didn’t exist at the time of the financial crisis. As the universe of products available from non-bank lenders is continually developing, we would urge businesses looking for funding to engage with a professional adviser.
“Lots of businesses we speak to have made clear plans for the future: they generally want to expand, fund changes in business ownership or improve their current funding arrangements through refinancing.
“It’s critical that businesses don’t miss out on potential funding from not being aware of the new funding alternatives that are now open to them.”
The research, which surveyed 512 UK SMEs with between 10 and 249 employees, also shows 30% of SMEs who were rejected by their first-choice lender, stopped searching for external funding altogether. This suggests that many businesses, of whom 55% said high street banks were the first lender approached, are potentially giving up when there are suitable alternatives available.
Positively, appetite for lending remains high with more than a quarter of businesses (27%) saying they applied for funding within the last year.