Financial services

77% of financial services firms expect prospects to improve

More than three-quarters of financial services firms (77%) believe that their prospects will improve in the next year, according to the latest research.

The inaugural report from Smith & Williamson – Dream bigger: The scale-up moment – revealed that 46% of such firms went as far to say that their performance would “improve significantly” in the next 12 months. 

In addition, over half of firms (55%) said that they would increase their level of borrowing in the next 12 months to fund growth plans, while 44% said they would borrow “much more”.

The report also suggested that banks and investors could be loosening their purse strings.

More than half of financial services firms (56%) claimed that access to finance had improved in the last year, some eight times the 7% of firms which felt that it had got worse.

Guy Swarbreck, head of the financial services and markets group at Smith & Williamson (pictured above), said that considering the potential, and realised, impact of regular regulatory change and Brexit, it was heartening that financial services firms were so positive about the year ahead.

“However, the sector has been quick to adapt to constant change with fast-growth businesses, talent and finance flowing into the fintech sector.

“While the UK is a great place to start and grow a business, there are concerns that regional development is falling behind.

“London has everything that growing financial services businesses need and this creates a clustering effect: businesses of a similar size and type gather together, creating a powerful ecosystem – developing knowledge, generating jobs, increasing access to finance and, as time progresses, a snowball effect occurs.

“As a nation, we need to find ways of encouraging this type of business clustering outside London.

“While progress has been made in some areas – such as the process industry cluster in the North West, biotech in Cambridge and Bristol’s tech cluster – it takes time to build momentum.”

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