Friends and family ‘fund small firms’

One in ten small and medium-sized enterprise (SME) owners are finding finance from friends and family, research claims.


One in ten small and medium-sized enterprise (SME) owners are finding finance from friends and family, research claims.

One in ten small and medium-sized enterprise (SME) owners are finding finance from friends and family, research claims.

A survey of more than 500 entrepreneurs carried out by Close Invoice Finance discovers more SMEs are been forced to source funds from areas other than banks.

The poll finds less than six per cent of companies are confident they will be able to secure cash from banks, compared to 73 per cent of those quizzed one year ago.

David Thomson, chief executive of Close Invoice Finance, comments: ‘With banks now closing their doors to SMEs, owners are relying on friends and family for financial support, placing immense pressure on these most precious relationships.’

In addition, Thomson claimed cash control is more important to SMEs over the recession, meaning they have to pay close attention to sourcing working capital and combating late payments.

The research goes against figures from the British Bankers Association earlier this week, which claimed banks are furthering their relationships with the UK’s small businesses.

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