Conister Finance comments on small businesses cutting jobs as the furlough scheme winds down

Commenting on small businesses cutting jobs as the furlough scheme winds down, Douglas Grant, director of Conister Finance & Leasing Limited, said:

“Sadly, today’s data from the Federation of Small Businesses is unsurprising and only the beginning of what is to come. We are facing a significant double dip recession that could last well into late 2021 and the economy will be hurt by both SMEs closing and mass redundancies for a significant part of the workforce. UK SMEs are not just the lifeblood of the economy – it is where innovation and creativity happens. For many years alternative lenders have worked alongside larger more traditional clearing banks, offering vital liquidity through tailored and flexible lending solutions to SMEs. Since the epidemic took hold, the UK Government has been quick to back sectors that are resilient to recessions and market volatility, providing financial security and protection through initiatives such as the bounce-back loans scheme.

“According to The City UK, it is estimated that businesses may build up £100 billion of debt by next March which they would be unable to repay with 780,000 SMEs in danger of insolvency. It is imperative that SMEs have a tripartite level of support from Government, alternative and traditional lenders working together to identify and protect the more resilient sectors such as infrastructure, technology and renewables, ensuring their existence guaranteed. This is where alternative lenders that understand the characteristics of specialist SMEs and with the flexibility they offer, empower their staff to make judgement calls on capital requirements often in the infancy stage of lending, can provide the additional support and natural lending progression alongside the larger clearing banks. Larger clearing banks, already under pressure from mortgage lending, will not be able to keep the UK SME sector alive by themselves.”

Kindly shared by Conister Finance & Leasing

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