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Small businesses get no-deal Brexit survival guide amid fears firms are not ready

Small businesses have been issued with guidance on how to prepare for Brexit amid increasing fears SMEs are not ready for a no-deal.

UK Finance – the trade body for the UK’s banking and financial services sector – has urged businesses to speak to their banks about extra finance as soon as possible and consider the impact of potential changes to trade arrangements.

It said the industry had the capacity to support businesses “whatever the outcome.”

Firms have also been told to capitalise on the opportunities of Brexit to maximise growth in an online guide published this morning.

Earlier this month Bank of England governor Mark Carney warned that half of UK businesses were not ready for a no-deal Brexit, according to it various recent surveys.

As uncertainty around Brexit looks certain to go down to the wire, UK Finance has issued guidance for SMEs on how to prepare for Britain’s departure from the EU.

The campaign has also been backed by the Federation of Small Businesses (FSB), the British Chambers of Commerce (BCC) and the Confederation of British Industry (CBI).

“The banking and finance industry has the capacity to support viable businesses whatever the outcome,” UK Finance chief executive Stephen Jones said.

“Any business customers who may have additional financing requirements should begin engaging with their provider now, as the earlier they do so the easier it will be,” he added.

The online guide lists sector specific information hubs to help firms develop contingency plans and provides details on how each bank has committed to help firms around Brexit uncertainty.

Businesses that don’t export or import directly have also been urged to check with customers and suppliers to pre-empt any changes.

FSB chairman Mike Cherry said: “With less than 40 days to go until the UK leaves the EU on 29 March, it’s important for small businesses to prepare for the pressures that may well affect them, especially if we end up with a no-deal Brexit on that date.

He added: “As part of that preparation, we recommend that small business owners and the self-employed talk to their banks or other finance providers as they may well need help to extend overdrafts, seek extra finance or secure extra flexibility for repayment plans.”

Source: City AM

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UK SMEs keen to seek alternative finance in 2019 despite Brexit

More than one-quarter of UK businesses expect revenues to grow by more than 10% in 2019, despite concerns over the potential impact of Brexit.

According to a report from asset-based lender Independent Growth Finance (IGF), their growth ambitions come despite nine out of 10 saying they have concerns about the future of the economy.

IGF’s Powering Freedom Report found that, among British businesses turning over between £1 million and £500 million, 69% of companies expect an increase in revenues in 2019.

To facilitate these ambitions, 71% of businesses are seeking an average of £1.1 million of funding over the next 12 months. This will be used to finance key areas of investment including technology (37%), staff retention (30%) and marketing (27%).

However, traditional lending channels remain slow, with 53% of businesses typically having to wait at least a month for a funding decision in 2018, while nearly one-third have waited three months or more.

As a result, more businesses are considering alternative forms of finance, IGF executives say.

While traditional bank funding remains the top source of finance (67%), the report found that 27% of businesses now use invoice financing and 22% use other asset-based lending facilities.

John Onslow, chief executive officer of IGF, said: “British SMEs are the lifeblood of this country. It is encouraging to hear how many are forecasting meaningful growth in 2019.

“Such a large number of businesses seeking more than £1.1 million in funding shows that businesses want to seize control of their financial futures. Yet our findings suggest many struggle to find quick and flexible funding. With uncertainty on the horizon, SMEs are refusing to stand still. Instead they are pushing for ambitious growth and alternative funding solutions.”

Source: Asset Finance International