Business Finance Review – Highlights

UK Finance has produced a Business Finance Review covering the first quarter of 2019 that makes for interesting reading. You can read the full document on their website but we thought you may find some of the highlights of interest which we mention below.

There are in the region of 4.5 million small and medium sized enterprises (SMEs) here in the UK. A significant number of them will be borrowing in some way whether that is by way of say overdraft or business loan.

In 2018, around £25 billion of loans were approved by lenders here in the UK to support SMEs financially. Small and medium sized businesses located throughout the UK applied for such finance.

In the first quarter of 2019, the amount of new business loans came to £6.1 billion with this being a little less than the figure for the same quarter last year although it is worth noting that the number of business loan applications reduced by 5% in Q1 of 2019 in comparison to Q1 of 2018. Apparently, more than 8 out of every 10 loan applications are approved and over 75% of overdraft applications are approved.

It is interesting that around 20% of business loans are at fixed rates of interest. Some people may think this figure is low as many may have thought that a business would have preferred the security of knowing that their repayments are going to stay the same throughout the term of the borrowing which is what fixed rate borrowing provides.

The repayment term on outstanding business loans as at the first quarter of 2019’s end was for a period of three years or more in respect of over 75% of the loans.

Another interesting statistic was that in the region of 60% of overdraft limits that had been sanctioned were being used.

In excess of 40,000 businesses used invoice discounting and factoring. Borrowings in relation to these amounted to over £22 billion.

If your business is looking for financial support perhaps to buy premises, replace equipment or purchase stock then why not get in contact with us and we will do all that we can to assist. We can put you in touch with a broker that has an extensive panel of lenders at their disposal and has many years experience in packaging lending applications. We look forward to hearing from you.

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