Todd Davidson, MD of Purbeck Insurance Services says: “We want to see Labour prioritising small business growth and funding.
“Access to finance from the larger banks for SMEs can be difficult and precious time can be wasted in pursuit of these facilities.
“Decisions by the big banks need to be expedited for SMEs so that they have the opportunity to explore other avenues if necessary.
“Reforms to the British Business Bank could make access to capital easier, particularly if the BBB increases links with alternative finance providers.
“At Purbeck, we see most applications for personal guarantee insurance coming from SMEs that have secured loans from alternative lenders.
“Also, knowing that cash flow can sometimes fluctuate, prior to taking finance, SMEs need to check what forbearance/assistance a lender would be able to provide in order to help manage cash flow and repayment obligations.
“Any policies on interest-only repayments, repayment holidays and the fees/charges in these circumstances, should be provided upfront by lenders in the application process.
“Fundamentally, closer liaison is needed between the new Government and the lending community to help SMEs overcome the barriers to finance.
“At the same time, Labour needs to recognise that navigating the myriad of SME finance options can be daunting.
“Improved awareness and education are needed on how different loan facilities work and what can be done to reduce the risk of personal guarantees such as sharing the guarantee or using personal guarantee insurance.
“As we await the outcome of the FCA’s review into small business lending practices, small business owners can alleviate concerns surrounding personal guarantee backed loans and instead view them as avenues for growth and opportunity.