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SME Spring Optimism

As we enter spring, many small businesses are becoming more optimistic, especially when it comes to imports and exports. After a harsh winter, this is welcome news. However, cash flow and late payment problems remain an issue, as well as the restricted access to business funding due to the big banks tightening their lending conditions.


SMEs are more confident about the current UK economic climate and international trade prospects, according to the latest data from the Western Union Business Solutions International Trade Monitor.

Almost two thirds of UK small businesses think they are optimistic about international trade conditions – which is surprising given the ongoing eurozone crisis. This is an increase of 9% on the previous quarter, which was the lowest on record.

The winter saw UK growth levels shrink, with a 0.2% economic contraction, but confidence levels have now hit a six month high in the first few months of 2012.  

Confidence in the UK national economy has also improved, with 47% feeling confident in the UK economy, compared to 40% last quarter. A double dip recession is now thought to be ‘unlikely’, according to the data of the survey – 58% feel that the UK economic climate has stabilised over the last six months.


However, cash flow problems remain for many businesses. Credit is an overwhelming problem, with 81% of SMEs seeing no improvement in its availability. This is worrying, as lack of credit is a key restriction on growth – which will be important for the UK economy to fully recover.

Businesses looking to ease their lack of credit can look to alternative lenders for help.

Invoice discounting, factoring and asset based finance are all important to consider if your business is struggling to find a way to improve cash flow. Lending is secure, fast, flexible and very affordable, which is a good thing to hear in light of banks tightening lending conditions and increasing interest rates.

If your company is looking for a way to build up an even more optimistic outlook for 2012, then Select Factoring can help.




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