SME owners ‘are relying on alternative financial resources’
Owners of small to medium-sized enterprises (SMEs) are seeking financial support from providers other than banks in a bid to beat economic difficulties.
This is according to a new study by More Than Business, which showed that one in five entrepreneurs has sought assistance elsewhere recently to help their company stay afloat.
A collective 14 per cent approached credit card or loan companies, but ten per cent generated funds from friends or family members.
Meanwhile, 58 per cent of SME owners said they fear they may go out of business should a double-dip recession occur.
More Than found that costs for SMEs have risen significantly over the past year, with the manufacturing industry the worst affected.
Spokesperson Mike Bowman said: “SME cash flow is suffering and in a slow recovering economy, some small business owners may be unable to rely on financial support from banks.”
Last month, Luke Johnson, owner of Risk Capital Partners, told the Financial Times that anyone thinking about buying a business could consider taking on shareholding partners as a way of preventing debt.
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