SME borrowing set to skyrocket in 2023, survey finds
Some 89% of SMEs are planning to borrow in order to cover costs in the next 12 months, according to a survey published by Allica Bank.
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The new research – based on the views of 150 SMEs – revealed 43% of respondents said they will need to borrow ‘simply to survive’.
A further 37% said they plan to borrow to refinance existing debt.
Around 10% of respondents claimed they need more clarity about borrowing, while 17% said they want a greater selection of loan products to choose from.
According to Allica, the survey results indicate the possibility of SMEs becoming over-leveraged or missing opportunities to support growth.
Conrad Ford, chief product officer at Allica (pictured above), said SMEs must be made aware of the products available to them and receive “the expert attention they deserve”.
He continued: “It’s the responsibility of banks to give businesses the best chance of surviving and thriving through this recession by ensuring they can make informed choices.
“This needs to be backed up with fast and clear responses to loan applications, so that businesses aren’t waiting weeks for an answer.
“While banks should actually look individually at each application and assess each business on their own merits and opportunities.
“Fewer and fewer banks still offer their customers a proper relationship manager – someone that can walk business owners through their available options and help them make an application.
“At Allica Bank, we make relationship managers a core part of our offering for our business customers, because we know how valuable their expertise can be especially as the economy is expected to enter recession.
“We also recommend businesses consider speaking to their accountant or a commercial finance broker for support when looking at their finance options.”