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A third of SMEs are at risk of permanent closure if they are unable to secure necessary funding according to a recent survey conducted by invoice finance company Novuna Business Cash Flow, underlining the crisis facing lending to the UK’s smaller companies, a topic which will be explored in one of the keynote sessions at Asset Finance Connect’s (AFC) upcoming summer conference in June.

The research revealed that 28% of UK SMEs reported being turned down for funding. This failure to secure accessible and flexible finance may explain why 50% of SMEs have not sought any financial assistance since November 2023, despite the finding that 34% are facing closure.

Additionally, the survey showed 29% of SMEs have had to apply for business funding for the first time ever. John Atkinson (pictured), head of commercial and strategy at Novuna Business Cash Flow commented: "As we navigate these turbulent times, our focus must be on creating a more supportive financial environment that acknowledges the evolving needs of small and medium-sized enterprises.”

AFC’s summer conference, on 6th June, features a keynote presentation from Martin McTague, National Chair of the Federation of Small Businesses (FSB). At the end of last year, the FSB brought a super-complaint to the Financial Conduct Authority (FCA) regarding the excessive use of personal guarantees to secure business lending, which the federation says is hampering small business growth by dissuading them from borrowing to expand.

The FCA has since agreed to investigate the issue, notably by collecting data from April to June 2024 to understand the workings of personal guarantees for sole traders and partnerships borrowing less than £25,000. However, the FSB says the regulator has missed out on the opportunity to assess whether or not there are systemic problems with personal guarantees as the FCA will not be gathering evidence from regulated lenders, which would illustrate the scale of the problem affecting limited companies.

“It is clear from the FCA’s refusal to look at the issue of personal guarantees in the round that the regulator lacks in-depth understanding in how SME lending currently operates. At AFC we are calling for regulators to learn more about the asset and motor finance market, to ensure that their interventions are both proportionate and effective,” Edward Peck, AFC CEO, said.

At the AFC conference FSB Chair Martin McTague will examine the background to the FSB super-complaint, the first in ten years, as well as the importance of SMEs to the growth ambitions of the UK government, and will analyse what lenders can do to make the SME journey better.

AFC’s UK summer conference on 6th June at etc venues, County Hall, London will look at the issues raised by the FCA’s regulatory intervention into the asset finance market in depth. For more details, visit the event website at

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