Jon Salisbury

Commercial lenders can fill Northern Irish SME funding gap

SMEs in Northern Ireland are receiving a very small slice of the pie in terms of a key government loan scheme and a significantly smaller slice than their counterparts elsewhere in the UK.

The latest statistics from the British Business Bank show that SMEs in Northern Ireland received just over 1% of the total lent through the Enterprise Finance Guarantee (EFG) scheme last year. This equates to just £42.4m of the total of more than £3bn lent in 2017.

In comparison, SMEs in Yorkshire and the Humber received more than 8% of the total amount lent, while businesses in London received over 15%.

If that was not bad enough, SMEs in Northern Ireland also had the lowest ratio of the number of loans per 10,000 businesses of all the regions in the scheme, with just 23.8 loans per 10,000, compared with 54.5 in Wales and 60.1 in Scotland.

This demonstrates the size of the funding shortfall for many small businesses in Northern Ireland. The EFG scheme has been effective, but it is not reaching all businesses, and this is where commercial lenders such as Ortus Secured Finance can step in and fill the gap.

So, why are many businesses missing out? Some may not be aware they are eligible for support and some may not know that the scheme even exists. However, alternative finance providers have enabled SMEs in the region to access much-needed funding.

Northern Ireland has plenty of opportunities for lenders, in part due to its strong entrepreneurial culture.

Overall, business confidence in the region is still high according to a survey by the Federation of Small Businesses, despite Brexit uncertainties. Northern Irish SMEs also performed well in the Centre for Economics & Business Research’s SME health check last year.

With EFG funding still not fully reaching Northern Ireland, we at Ortus have had the chance to work with some great entrepreneurs and businesses in Northern Ireland and we look forward to helping more in the future.

Leave a comment