If you’ve ever been turned down for a business loan, you’re not alone. New analysis from Fleximize, an alternative SME lender, reveals that during the first half of 2015, banks rejected over £150m-worth of credit applications from SMEs in Scotland.
The analysis also found that between April and June this year, the approval rates for smaller businesses in the UK applying for loans and overdrafts was 80% and 78% respectively, and the corresponding figures for medium-sized businesses was 90% and 93%.
This level of rejection is fuelling demand for alternative forms of lending. Fleximize estimates that in total, up to £167m from alternative lenders has been taken out by businesses in Scotland.
Max Chmyshuk, Founder and Managing Partner at Fleximize, said: “As the British economy improves, demand for credit from SMEs is increasing but banks are still rejecting a significant number of applications. Alternative lenders such as ourselves are benefiting from this – in the first half of this year the amount we lent to clients was 211% higher than in the same period in 2014.”
To help smaller businesses understand the huge and growing range of funding options open to them, Fleximize has produced the free Ultimate Guide to Business Funding, which provides a comprehensive overview of multiple financing routes available to SMEs, including five alternative and four public funding sources, as well as overdrafts, loans and commercial mortgages from traditional banks. The Guide addresses modern sources including crowdfunding, pension-led funding, unsecured business loans, revenue-based finance and invoice discounting, as well as public funding offered on a national, regional, local and specialist basis.
