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Trends in the SME finance and funding market

Trends in the SME finance and funding market
Thursday, May 24, 2018

The 2018 Small Business Finance report has just been released. Here is Panthera’s quick guide on everything important that the report highlighted.

New statistics published

The British Bank has just published a report on small business market finance and funding in 2017/18. This is now the most up to date publication of these kinds of statistics – the last one being from December 2017. The report contains information on market growth statistics, financing, and general business development data.

What were the main points?

From the 80+ page paper that was published, here are the key points that were made:

Finance is diversifying

Many business owners are choosing alternative methods of financing their businesses. In general terms, this means that more businesses will be getting a means of finance that will better suit their needs.

The number of small business equity finance deals and the value of smaller business asset finance deals are both up by 12%. This could indicate that more businesses will thrive in the future because of the wider choice of financing options.

Startups are on the rise

This last year has seen the highest ever number of new businesses being created at 414,000. This increase is one of the contributing factors in 2017 having the highest number of businesses in our country’s recorded history. There is now a total of 5.7 million businesses in the UK, 35% of which are considered startups.

How banks are lending

72% of small businesses are having their loan applications approved. This level of financing for businesses will help stimulate more growth in the economy. That being said, the paper also has said that 70% of businesses would rather forgo growth than borrow money. This lack of willingness to acquire funding could indicate that bootstrapping is becoming more common amongst entrepreneurs.

Peer to peer lending has started to challenge the way that most commercial banks deal with business owners. The report also pointed out that, despite the buzz around it, P2P lending still only makes up 3% of the funding market.

Regional imbalances

Roughly 19% of businesses in the UK are in London. However, the report has found that 51% of all UK equity investment deals are made for companies that are based in London. This creates a large gap between businesses that can afford to be based in the capital and those who are forced to set up shop elsewhere.

Perhaps HS2 (the planned high-speed railway that will link up the whole country) will improve the climate for business investment in areas suffering from slower growth. If the country is more connected, then other technological or financial centres could emerge in other cities across the country.

What else is worth mentioning?

The report has also shown that many younger companies that would like to grow are having trouble finding finance from commercial banks. A lack of a business track-record and experience is said to be the blame for the funding applications being turned down.

In the second quarter of 2017, 81% of small business owners agreed to this statement: “our current plans for the business are based entirely on what we can afford to fund ourselves”. This helps illustrate the point that entrepreneurs are using their own finances to start and grow their businesses instead of seeking out investors.

We can help

If you are a business owner and you would like some help in making your business ready to receive finance, get in touch with our team. Our accountants will be able to give you a good idea of where you could use funding, and what the most efficient way to use it is. Call us today on 01235 768 561 or email enquiries@pantheraaccounting.co.uk.

What our clients say

For us, there is nothing better than a happy customer. Here are just a few that let us know how much we mean to them.

Pete Dungey

Simple, efficient and most importantly, hassle-free.

We found Panthera via our search for a Xero expert. We knew the software we wanted to use, and needed a forward-thinking accountancy partner who could get us up and running, and teach us the ropes moving forward. Tory and her team have always been on hand to answer our questions, and help us to grow as a business, particularly during periods of big change, such as becoming VAT registered. They are always on hand to alleviate any concerns and help to keep our records in order, which makes our year-end accounts an absolute breeze! Being based in Bristol, our relationship is entirely email based, alongside one consolidation meeting at year end - this keeps things simple, efficient and most importantly, hassle-free.

Pete Dungey Kaleido Grafik Limited
Anita van Eijndhoven

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The support and service we receive from Panthera Accounting is very good. Everything from regular meetings, a prompt e mail response and the transition of our Xero software (which we find very pro active indeed) has and is all remarkably efficient. We find Panthera talk our language and make any process as painless and easy as possible.

Anita van Eijndhoven Quidne-IT
Ash & Tim Lane

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We got in touch with Panthera Accounting by way of a recommendation; we haven't looked anywhere else since. They are an extremely professional yet relaxed group of people. We were slightly daunted by the idea of accountants but Panthera brushed aside y the stereotypes. They are very understanding when answering any questions we may have. They are completely efficient, offer sound business advice, and are fantastically priced. We will continue to recommend them.

Ash & Tim Lane Starveacre Fencing
Jayne Johnson

An Asset to my Business!

The whole team at Panthera are great! Working with them has been a huge support to my growing business. They help me to understand the numbers I need to know. They give me technology solutions like Xero so that I can process things quickly and have access to my own figures. They are quick to reply, highly knowledgeable, nothing is too much trouble and as well as making sure that everything is compliant and on time, they are enthusiastic, professional and fun to work with.

Jayne Johnson Better People
John Baker

Absolute joy - they provide a first class service on every level

Working with Tory and the team at Panthera is an absolute joy - they provide a first class service on every level; from simple Xero issues through to more complicated tax enquiries, they’re always on-hand to help me get it right. I’m certainly not their biggest customer, but I’m always made to feel like their most important one.

John Baker BKR Solutions
John Castle

Professional and Friendly

I would like to say that Panthera Accounting have helped me with my business accounts for more than 4 years now. They have consistently offered an excellent competitively priced service that works both professionally and in such a friendly way that I would highly recommend them to everyone considering using their services.

John Castle Ilexanna Limited & Birch Castle Homes Limited
Jonathan Morrison

They are always there to answer queries and sort out issues

I had been with Mr Dunn for 20 years when upon his death Panthera took over the business. They now play a bigger part in the running of my business, they do all the stuff that has to be done but I don't like doing ie book keeping, VAT, wages, and returns. They are always there to answer queries and sort out issues and make sure all Tax deadlines are met. Their costs are fair, service is great and I have and would highly recommend them.

Jonathan Morrison Wallingford Builders
Pippa Scott

Professional, friendly and personal service.

Panthera Accounting have gone above and beyond the call of duty to guide and support our Company. They offer a professional, friendly and personal service that can take the stressful and sometimes frightening feelings out of running a business. They have guided us through the working of Xero and have offered “teaching sessions” on the day to day running of the accountancy package. Our only regret is that we didn’t join their team earlier.

Pippa Scott Scott's Commercial Services Limited
Sara Southey

Panthera puts the personal back in to accountancy!

Tory and her team have provided a friendly, approachable and helpful service from the start. They have delivered a quality service, above and beyond anything I could have expected. Panthera, with the help of the Xero package, have taken the stress, strain and confusion out of managing my company and personal accounts. I look forward to working with them for many years to come.

Sara Southey Bluestones Garden Design
Tracey Miller

Panthera are fantastic.

Panthera are fantastic. Always professional, going the extra mile for their clients and delivering superb service. I recommend them all the time to my clients.

Tracey Miller Bigger, Brighter, Bolder BBB

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