In its report into the 2014 Budget, the Treasury Committee has reiterated the difficulties SMEs face when seeking finance – something which is preventing some businesses from reaching their full potential and hindering the economy.

Robert Wood, Chief UK Economist at Berenberg Bank and witness for the Committee, said: “very poor availability of finance over the past few years has almost certainly prevented some rapidly growing firms from expanding.”

It’s a view shared by fellow witness, the Confederation of British Industry (CBI). They said: “SME underinvestment is a structural rather than a cyclical problem,” and advised a wider range of financing sources be made available for smaller firms as a solution to the problem.

The Treasury Committee’s Budget 2014 Report adds further weight to the opinion that SMEs find it difficult to source funding in the UK.

Already, the Government is in the middle of a consultation into the problems SMEs face when looking for investment and since March there have been similar reports from The Financial Conduct Authority (FCA), the Office of Fair Trading (OfT) and the Bank of England (BoE) who have all agreed that there is a lack of support and options available to SMEs if their loan applications have been rejected by the major banks.

Nick Montague, CEO and founder at FundingStore, said: “It’s not simply about access to finance, it’s also more about understanding all the different options, now that mainstream banks are not the automatic choice for many businesses.

“FundingStore clarifies the confusion for businesses and provides a whole of market choice of funders for the SME.”

by Dave Hort

  • coins