British SME confidence in their future prospects lags behind other large economies, the latest Sage Business Index has shown.
The report shows a confidence rating of 62.55 for the UK’s small and medium enterprises, just above the average for all markets, which is set at 62.02.
Respondents to the survey were asked to judge business confidence on a scale of one to 100.
Brazil hit the top of the league table, with a score of 71.62, followed by Singapore at 66.96 and Canada at 66.80.
Banks were one of the key factors to blame for decreased confidence, as over two-thirds of businesses from all countries surveyed said banks weren’t doing enough to make funding available to small businesses. A similar number also believed governments needed to do more to support small enterprise and put the pressure on banks to provide capital.
The Sage Business Index says:
“A lack of support from traditional financial institutions is resulting in businesses looking to secure investment from alternative sources. In response to a shortfall in available capital, crowd funding and peer-to-peer funding have emerged in recent years as alternatives to conventional sources of funding.”
73% of British SMEs believed the government needed to do more to encourage banks to lend – the UK was rated in fifth place of all of the countries surveyed for believing their government isn’t doing enough to support SMEs.
The survey results come just days after the Bank of England’s Latest Trends in Lending report showed lending to SMES had fallen by £400 million in the second quarter of the year.
Andrea Leadsom, the economic secretary to the Treasury, is pushing for better support for Challenger banks in order to secure a more effective lending system to Britain’s small businesses.
Image by Craig Anabadili