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Recession born SMEs hit terrible teens and reach out for cash

Size of personal guarantees rises 32%

Personal Guarantees by small business owners increase in size

Budget must help small businesses old and new. Purbeck Insurance Services, the provider of personal guarantee insurance has revealed a trend in the owners of small businesses established in the height of the financial crash in 2007-2008 who are now having to put their personal assets on the line to secure finance for their business.

SMEs and recession

Financial honesty is the best policy for SME owners | Purbeck

8 out of 10 small business chiefs come clean when they put the home on the line

Family protecting with Personal Guarantee Insurance

Money worries can be the biggest cause of relationship woes but recent research by Purbeck Insurance Services, the provider of Personal Guarantee Insurance has found that most small business owners do the right thing and come clean to their partner when they take the big step of putting the family home on the line for their business.  8 out of 10 small business owners[i] have informed their partner about a personal guarantee they have signed for new business finance. 

Purbeck Personal Guarantee Insurance Financial And SME Ownership

Accountants on the frontline

Adding Personal Guarantee Insurance to the mix of small business services

Accountants are on the front line when it comes to understanding the financial pressures facing the UK’s small businesses.  Late payment, managing cashflow, the Brexit deadlock are all making business harder for the directors and owners of SMEs and it’s often access to finance that determines a business’s fate, particularly in the early years.  

Accountancy

Purbeck supports the new bill to clampdown on late payment

  • Purbeck Insurance Services fully supports the new bill to clampdown on late payment in the construction sector which has such a negative impact on subcontractors in this market. Our own survey of the market has shown that 35% of small businesses in the construction sector find managing late payment the hardest thing about running their firm.

Late payment

Burnout beckons for female small business leaders | Purbeck

  • Burnout beckons for female small business leaders – 46% never switch off compared to 38% of male leaders

  • - Bosses aged 35-44 in Property Development, Construction and Legal Services least able to switch off from work
  • - East Midlands is worst for ‘switching off, Scotland is best
  • - Employers of 10-49 people have most difficulty switching off
Female small business leaders

The big trends for small business finance in 2020 | Purbeck

Human hand holding bulb with money tree inside. Wealth concept

  • Technology will continue to drive innovation in small business finance. The days of making an appointment with the bank manager is becoming a thing of the past.  Technology is making the process more streamlined, speeding lending decisions and access to finance for small businesses. In 2020, Open Banking and the ability to draw information from accounting software will give lenders and financial intermediaries a wealth of information that will enable them to provide focused credit solutions.
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  • Peer to peer business lending will continue to grow in 2020. P2P lenders will play a valuable role in providing access to credit for small businesses – particularly those who have not been able to access high street bank funding.  This will fill the funding gaps for underserved businesses and will help underpin many new start-ups in the year ahead.
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  • New rules concerning who gets paid in what order in an insolvency could also support growth in Peer to Peer lending. In April 2020, HMRC will become a preferred creditor in a business insolvency for certain HMRC debts[i]. These changes will encourage traditional lenders to consider their risk exposures.  This may lead to a tightening of credit and/or credit at more expensive interest rates due to the preference of HMRC over floating asset and unsecured creditor positions.
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  • There will be a continued reliance on financial intermediaries such as accountants and finance brokers in 2020 as small businesses seek expert support to determine their best finance options. There will be a particular demand from those businesses who have not been able to secure finance from high street banks.
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  • Collaboration between banks, alternative finance providers and policymakers will ramp up to ensure that businesses have access to critical funding lines, particularly if the UK leaves the EU without a deal.
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Small business finance trends in 2020

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