Smaller businesses still face failure due to cashflow barriers

Smaller businesses are continuing to face cashflow barriers to funding across the UK, due to slow and lengthy processes.

Smaller businesses are continuing to face barriers to funding across the UK, with 73 per cent of them finding the application process to be overly ‘long and painful’, according to figures from small business lender Ashley Finance.

Despite figures showing that cashflow is responsible for up to 90 per cent of small business failure, smaller UK SMEs are struggling to access cash to support their working capital needs.

The stats from Ashley Finance’s recent SME survey directly correlate to figures from the British Bankers’ Association that shows a dip of £1.6 billion in business borrowing from banks in February 2017, as smaller SME owners fail to find funding options that suit their individual needs from traditional lenders.

The revealing statistics make a clear case for a continued push for better access to funding for UK SMEs, but also highlights the barrier that many smaller businesses, particularly those with a less than perfect credit score, are experiencing when seeking cashflow solutions.

Richard Waldman, group sales director of Ashley Finance, says, ‘The SME market is facing uncertain times, and our research shows us that matters are being made worse for a proportion of businesses that are struggling to access funding via traditional routes.

‘For many of our customers, an injection of cash can be their saving grace, helping to take the pressure off and allow them breathing space when times have gotten tight. Faced by difficult questions and forms requiring years of backdated evidence of operation, they might find themselves in unnecessary dire straits when flexibility and a personal touch in the decision process is all it really takes to get a ‘yes’ to funding that is so desperately needed.

‘It’s a fact of life for businesses that cashflow is a fundamental and a simple short-term funding solution shouldn’t be a stressful undertaking.

Further reading on cashflow barriers

Owen Gough, SmallBusiness UK

Owen Gough

Owen was a reporter for Bonhill Group plc writing across the and titles before moving on to be a Digital Technology reporter for the

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Cash Flow