Good news from the British Chambers of Commerce: business confidence is improving and the economy has grown in the first quarter. However, it believes that SMEs need more backing to maintain this momentum, a forecast which puts the spotlight on SME credit services such as invoice finance.
In its Q1 2012 Quarterly Economic Survey, the BCC has reported that business confidence is improving, with companies, including SMEs, expecting turnover and profit growth in 2012. It has also stated its belief that the UK economy grew in the first quarter of the year. If such expansion is confirmed, it will mean that the country has avoided slipping back into recession.
However, at the same time, the BCC has emphasised that SMEs need a great deal more help if this tentative upturn in confidence and economic growth is to lead to a stronger recovery in conditions. It has called on the government to take radical steps to achieve this goal, including ramping up its credit easing scheme, scrapping the rise in business taxes and introducing a SME bank dedicated to improving small business lending.
The statement from the BCC gives growing credence to the growing belief that, while the 2012 Budget included measures designed to help SMEs and the National Loan Guarantee Scheme is a positive development, the government has not gone far enough to improve small business credit facilities in the UK.
According to the BCC, cash flow remains a real problem, which underlines the growing role of alternative small business lending facilities such as invoice discounting, factoring and asset finance. It seems clear that alternative SME credit facilities will play an increasingly prominent role alongside high-street lenders, and the BCC’s comments go some way to confirming this sector’s importance.
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