Nearly two thirds of businesses surveyed by YouGov say that banks are not lending to small businesses as much as they should, whilst six in ten believe that it is actually harder to access credit now than it was five years ago.
eBay’s study also reveals that Britain’s entrepreneurs may be taking matters into their own hands and seeking alternative sources of finance, with three quarters of small businesses no longer reliant on support from their bank and nearly two thirds of UK small businesses say that they do not need the banks in order for their business to be successful.
eBay’s study also reveals that trust in banks remains low, with a third of small business owners saying that they don’t trust their business bank. According to the government the largest four banks – Barclays, HSBC, Lloyds and RBS – account for 80 per cent of UK SMEs’ main banking relationships.
In 2014, innovation experts NESTA estimated that alternative finance provided £1.74 billion of funding to over 7,000 SMEs – up from just £276 million in 2012. This rapid growth prompted the government to announce a consultation in the 2014 Budget, exploring options for matching SMEs rejected for by traditional sources of finance with alternative lenders.
Tanya Lawler, Vice President of eBay in the UK, says that more needs to be done to connect promising businesses with investment as the economic recovery takes hold: “Small businesses are increasingly confident about their prospects, with two thirds of those that we’ve spoken to predicting an increase in sales over the next 12 months.
“However, this confidence in the economy is not translating into confidence in the banks, as reflected by the high proportion of SMEs no longer reliant on banks for funding. We’d like to see more done to connect viable SMEs with alternative sources of funding that can spur sustainable growth.
