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Peer2Peer Finance News | November 18, 2017

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Funding Circle: Small businesses braced for higher costs after Brexit

Funding Circle: Small businesses braced for higher costs after Brexit
Marc Shoffman

MORE THAN two thirds of small businesses that import goods and services expect costs to increase when Britain leaves the European Union, Funding Circle claims.

A poll of 1,325 small business borrowers by the peer-to-peer platform found 69 per cent of firms expect their average costs to increase by £5,300 per month resulting in £60,000 per year of extra spending.

Businesses were also deflated by the overall result of the general election with only 12 per cent stating that they feel positive about the outcome, while 41 per cent were concerned.

Read more: Entrepreneurs defy Brexit with 3,000 new business registrations

There were some positives as businesses expect to hire at least one new member of staff over the next year, according to the research.

The majority of respondents also believed the general election result would soften the government’s Brexit strategy, which would be a good thing for their business operations.

“With formal negotiations with EU leaders having only begun last month, it is too soon to comment on the true impact Britain’s exit from the European Union will have,” James Meekings, co-founder of Funding Circle, said.

“What is clear, however, is that we must consider how best to support importing small businesses who face a potential increase in costs as we leave the European Union.”

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Read more: Treasury plans new fund to support UK start-ups after Brexit