Last month saw the publication of the Business Finance Guide jointly produced by the British Business Bank and the Institute of Chartered Accountants in England and Wales (ICAEW).
The guide, while being thought provoking and useful, can’t be considered comprehensive as it fails to acknowledge pension-led funding! However, that aside, it represents yet another good move from the government and specifically the work that Business Secretary, Vince Cable has been doing, in promoting access to finance for UK small and medium-sized businesses.
Launching this guide for small and medium-sized businesses, Dr Cable said: “The business finance market is going through a period of rapid change with challenger banks, peer-to-peer lenders and invoice financing gaining traction. But over two-thirds of small and medium-sized firms only go to one finance provider, so it’s important businesses know about the huge variety of options open to them.
[blockquote]“This newly-published free guide should be essential reading for all entrepreneurs and directors, and will play a key role in raising awareness of the different types of finance available to start or grow their business.”[/blockquote]
While the Business Bank doesn’t lend directly to businesses, it has significant firepower, and, according to the department’s figures, introduced over £800m into the marketplace over the course of 2013. With a potential £3 billion on offer over the next five years, the government anticipates leveraging this number to closer to £10 billion, an amount not to be sneezed at.
And yet the evidence shows us that the vast majority of businesses still rely on their bank to provide finance, and many of those, once rejected, seem to disappear off the radar. Missed opportunities possibly.
I believe that the most effective thing that Vince Cable and the coalition government can do for UK business is to make sure that the rejection letter is not the end of the road.