INCREASING numbers of UK small- and medium-sized enterprises (SMEs) are aware of alternative finance options but peer-to-peer lender Growth Street is warning of a knowledge gap in the Midlands.
The latest annual survey of 2,000 small firms by the business lender found 66 per cent of respondents had at least some knowledge of finance outside of banks, up from 54 per cent in 2018.
A third, 34 per cent, of respondents said that they were not at all confident in their knowledge of non-bank funding, fewer than the 45 per cent who attested to this last year.
However, 37 per cent of Midlands businesses said they have no confidence in their knowledge of finance sources outside the banks, just above the national average.
When asked where they would go to seek alternative finance, 12 per cent of Midlands SMEs said they would use an accountant and 17 per cent didn’t know.
“With a greater focus placed by government on funding growth in the Midlands, it is crucial that Midlands SMEs are as clued up as possible when it comes to financing their businesses to take full advantage,” Greg Carter (pictured), chief executive of Growth Street, said.
“Clearly, huge progress is being made, but keeping the momentum up moving through 2019 will be central to the region’s success.
“That responsibility is with finance providers from across the spectrum – the fact that nearly a fifth of SMEs in the Midlands don’t know where they would go first when seeking finance paints a worrying picture of the disparity between London and other fast-growing parts of the UK.
“Greater emphasis needs to be placed on tapping into Midlands business people, both by traditional banks and alternative finance providers, to ensure continued growth following the challenges facing the UK.”