September was a record month for lending to small and medium-sized enterprises (SMEs), figures from the National Association of Commercial Finance Brokers (NACFB) have revealed, hinting that appetite to lend is beginning to return.
Lenders affiliated with the NACFB lent a total of £1.25 billion to smaller companies in the month – a new record and a post-crisis high. It easily beats the £1 billion lending figure reported in May, and incorporates the full spectrum of financial providers, including peer-to-peer lenders, crowdfunders and challenger banks, as well as traditional high street banks.
This just shows that there are far more options open to SMEs than they may think, with funding from their bank not the only possibility – a misunderstanding that has led many to struggle sourcing suitable finance.
The lending milestone was announced to coincide with the NACFB's Love Lending Week, an initiative designed to help promote lending to small businesses and raise awareness of the full range of funding options available. This kind of education could potentially fuel the growth of smaller firms, as currently, the majority of SMEs are still unaware of the options available.
Marcus Grimshaw, chairman of the NACFB, commented:
"In recent years we've seen a burst of new lenders enter the market to support many thousands of SMEs who have previously struggled to secure finance. Reaching £1.25bn lending in a single month is a very positive signal that lending conditions for SMEs are improving.
"[However,] there are still too many business owners who are in the dark about their finance options. We created Love Lending Week to spread the message that there are many lenders in the UK who are already lending to small businesses, and would love to lend more. We need to educate the country's small businesses about their options.
"If lenders, brokers and Government can all work together, the lending process can be streamlined and securing funding will become a more achievable task for SMEs."
Consider alternative funding options, such as bridging loans and invoice factoring
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