SMEs unable to access finance face "serious consequences"
Commercial insurance
23rd August 2010
The result of small and medium-sized enterprises (SMEs) failing to secure the finance they need for their operations can have "serious consequences", an expert has announced.
Forum of Private Business (FPB) media and PR spokesman Chris Gorman explained that a lack of access to affordable lending can prevent smaller organisations from growing and cause them further trouble during difficult periods "which would otherwise just be a blip on the finance", such as major clients delaying settling bills.
Mr Gorman warned that restrictions to credit can cause some SMEs to fold and could push up inflation, which will make conditions "more difficult for everyone", something which may be of interest to insurance for business customers.
His remarks come after the FPB warned that banks in the UK are continuing to undervalue commercial properties, which can result in excessive interest rates for smaller companies or prevent them from taking out loans altogether.
This follows figures showing that small business credit is rising slowly, but still remains substantially below last year's levels.
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