At a time of acute market uncertainty, the last thing SMEs need is higher bills. But that’s what they’re getting: business rates are due to rise on 1 April. Alternative finance should be part of the survival plan.

According to new research from the Federation of Small Businesses, over a third of the firms questioned are bracing themselves for a hike in business rates, with almost half of these businesses expecting to have to pay an extra £1,000 or more per year. The impact? Over half of those facing a rates rise said that they will have to shrink, postpone or cancel investment plans, while almost 20% claimed that they are considering closing or selling their business.

At a time when Brexit is wreaking havoc with business confidence and SMEs are facing significant pressure on cashflow and capital in the form of costs relating to auto enrolment, cybersecurity and the living wage, it is hardly surprising that an increase in business rates will be the straw that breaks the camel’s back for many.

So, how can SMEs survive? All eyes will be on the 2017 Budget and there have already been calls for support for small business owners to feature heavily. The Association of Chartered Accountants has called on the Chancellor to make Brexit-proofing measures for small businesses a priority, while a new report from the British Chambers of Commerce has produced an even stronger message: UK business leaders want Brexit put on hold if a trade deal can’t be struck.

With this picture in mind, it would also be good to see the 2017 Budget include measures to raise awareness of and improve access to alternative finance services. Crowdfunding has been back in the news and described as the new normal in terms of small business finance. Much the same can be said for other non-bank finance services such as invoice finance, asset finance and peer-to-peer lending, whose popularity has sky rocketed in recent years as traditional lenders have lost the trust of business owners.

If small businesses are going to survive an increase in business rates and on a wider scale, the financial demands and market uncertainty hampering development, access to flexible, affordable finance is vital. And this means a key role for alternative finance.

To find out more about A&T Business Associates services, contact us on 01903 602211 or info@atbusinessassociates.co.uk.