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How SMEs can finance staff wellbeing costs

Staff wellbeing is back in the news as a new study has again highlighted the relationship between employee health and SME productivity. The benefits of investment in this area are clear, but how can cash-strapped small businesses afford it?

According to new research from the Association of British Insurers, almost two thirds of SMEs acknowledge that the provision of health and wellbeing benefits has a significant impact on company productivity. Notably, nearly a quarter of SMEs consider health and wellbeing benefits critical to ensuring high levels of productivity.

The importance of health and wellbeing benefits and the strong link to company performance that the study reveals should come as little surprise, in particular after a year in which the impact of Covid-19 has put health of employees, from directors and management to front-line workers, in the spotlight.

Work patterns have undergone a sea change as a result of the pandemic and the impact on employee mental health and confidence has been significant. The disruption to routines and isolation are leading factors behind physical and mental health concerns.

Some firms have reacted well to the mounting concern over employee health and wellbeing, both for those that are still coming into work and those that are working at home. However, there is evidence that employers could be doing more. According to research from Breathe HR, over 40% of SMEs admit to having a lack of Covid-19-related wellbeing measures in place, while only a quarter said they offered mental health support in 2020.

Notably, data from the Mental Health Foundation show that 70 million working days were lost to mental health issues in 2019, costing industry and the economy £2.4 billion. The impact is likely to be greater in 2020 and 2021.

What is stopping more SMEs from offering health and wellbeing benefits, or expanding existing support policies? A major factor is cost, in particular for smaller firms. The impact on these companies has been extraordinary, with their ability to invest drastically reduced.

So, how can small businesses to invest in staff wellbeing and safeguarding company productivity? Alternative finance can help.

Staff wellbeing investment and how alternative lenders can help

With regard to alternative finance, in the wake of prolonged caution from traditional lenders, which is an issue that has returned during the coronavirus pandemic, alternative finance facilities such as invoice finance, asset finance and peer-to-peer lending are proving a vital source of capital for small businesses, both for maintaining cashflow and for essential investment.

These facilities, which offer a more easily accessible and personalised approach to lending, are helping small businesses survive and target recovery and regrowth.

Notably, alternative lending is playing a prominent role in the government’s new headline emergency support scheme, the Recovery Loan Scheme. Invoice finance and asset finance between £1,000 and £10 million per business are available under the initiative. This profile is helping cement the reputation of alternative finance in the business sector.

Investing in staff wellbeing and SME finance options

The impact of Covid-19 has underlined the role of staff wellbeing, which will surely remain a higher priority as workers adjust to post-pandemic conditions. As such, the importance of health and wellbeing benefits is only set to grow. To be able to invest, business owners need to be aware of all the funding options available to them, including the services of alternative lenders.

To find out more about A&T Business Associates services, contact Tony Hedger on 01903 602211 or tony.hedger@atbusinessassociates.co.uk.

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