A quarter of small firms rely on personal savings and handouts

The Advertiser Series: Bosses of small firms are supporting their businesses with personal savings and handouts from family and friends Bosses of small firms are supporting their businesses with personal savings and handouts from family and friends

A QUARTER of small and medium-sized firms are supporting their businesses with personal savings and handouts from family and friends, a new has shown.

Business funding specialist Bibby Financial Services, which commissioned the research, said the reliance on personal finance prevented firms from being able to take advantage of the first stage of economic recovery.

The survey revealed that almost half of small and medium-sized enterprises (SMEs) used just one source of funding, with 20 per cent of firms saying they relied on a bank overdraft and the same amount again using a bank loan.

David Postings, UK chief executive at Bibby Financial Services, said many business owners turned to those closest to them for financial support because they were not aware of the range of options available to them.

He added: "Businesses with unsustainable or limited sources of finance in place will find it challenging in the months and years to come if they cannot take advantage of the gradually improving trading conditions in the UK."

Mr Postings said the survey of 1,000 SMEs highlighted the value of the alternative finance market.

According to the Asset Based Finance Association, its members advanced £17.4bn to businesses in the third quarter of the year - an increase of 6 per cent on a year earlier.

Comments

Comments are closed on this article.

click2find

About cookies

We want you to enjoy your visit to our website. That's why we use cookies to enhance your experience. By staying on our website you agree to our use of cookies. Find out more about the cookies we use.

I agree