According to a survey by the Confederation of British Industry (CBI) and the Association of Chartered Certified Accountants of 380 small businesses, 33 per cent have applied for an overdraft over the past 12 months.

Some 73 per cent of overdraft applications have been accepted.

Credit from suppliers, within agreed terms, is also widely used, with 29 per cent of businesses seeking additional credit in the past year, and family and friends account for 21 per cent of financing means.

Russell Griggs, chairman of the CBI’s SME Council says: ‘Although banks remain an important source of finance, there remains a lingering perception that applications will be refused. However, this survey shows that three quarters of all applications for bank loans and overdrafts do succeed.’