Firms, both small and large, have been the vital contributors to the country’s financial growth. The ups and downs in their businesses have a direct impact on the national economic development. The impact of Brexit, no doubt, is huge in the macroeconomic environment of the United Kingdom (UK) and its financial enlargement. The interconnection between the country’s development and the performance of the small business firms decide the fate of the people here.
The companies have already warned about the uncertainty, which can continue until no specific period of time. It is true that the financial turmoil and subsequent credit imbalance have become tricky than before for the small scale business firms. If they not able to keep balance in this tough situation, they may find themselves running out of business.
Despite the Brexit, it becomes more important for the small business firms to keep an eye on the options available for them. It is only the matter of preparing well and executes all the plans, accordingly.
A Golden Opportunity for Small Businesses
Most of the financial experts in the UK are in the view that it is the right time for the small businesses to show their worth at the market. Banks and private lending institutions are now offering small business loans, which are specially modified for the infrastructural or other needs of the business firms. The loans may have advantages or disadvantages, but the firms have at least options to utilize and to stay steady despite the economic inconsistency at the national and international level.
It is the ‘Competition’ that drives the preparation, planning, and perfection of the businesses. If the small business companies hold their nerves during this difficult period, who knows that they might see major growth in the days to come.
No one can deny the fact that small business owners are facing the potential impact since Britain has gone out from the European Union (EU). The Government is doing its best on Brexit negotiations and try to support small businesses to contribute to the nation’s economic development. The debt market has also increased its presence by bringing flexible funding options for the small enterprises.
According to the recent study, small business firms are expected to increase their revenue in the next 12 months. The numbers of new employments are also expected to increase (it can go to millions), during this period.
Are Government’s grants enough or private lenders holding upper hand?
The year 2016 was quite impulsive for the small scale industries. But at the same time, the lending business in the UK has boosted the economy and gives a slight advantage to the businesses to fix their new growth plans. The Government is playing its role very well by funding the companies in varied forms, such as Regional Growth Fund (RGF), Business Finance Partnerships, Start-Up Loans, and UK Export Finance. Applying for these funding sources is different from one to another, but there are some general criteria to be qualified for the Government’s funding.
Are Government’s grants enough or not? It is a matter of debate. Some financial experts prefer them because they think that the Government’s efforts are in the right direction to protect the interests of the small businesses. Others have different views, as they are more favorable for the private lenders. These financial experts suggest that the private lenders have a wider reach to the people and they are more flexible than the banks or the Government.
The process of availing Government’s grants is comparably complicated and based on different stages. It is the reason perhaps most of the small business firms look towards the private lending institutions.
What Recent Study is Indicating?
Post-Brexit, the UK’s economy might have been affected at large, but small businesses here refuse to go down.
According to new data from Moneysupermarket, the numbers of small entrepreneurs have been on rising as compared to the last year. In particular, the service and repair sector has witnessed massive registrations during the first six months of 2017. It is followed by high street businesses and publishing sector, who also witnessed a decent growth in this year.
The small businesses in IT sector and leisure and tourism have also increased their revenues as compared to very disappointed 2016.
The effective concoction of debt market (especially peer-to-peer lending) in the UK and the spirit of small businesses have removed the negative impact of Brexit, particularly in 2017. The lenders are helping firms with presenting small business loans at competitive prices.
Overall, the early trends are certainly encouraging and the Government is hoping that it will continue in the years to come.
There is a huge demand of small business loans in the UK. The impact of Brexit is large, particularly for the small businesses. As compared to 2016, these companies are now looking more positive to their approach and the debt market has a big role to play in it. They are bringing effective loan deals, which match to their business needs.