The UK’s small and medium-sized enterprises (SMEs) have been battered by months of lockdowns and stifled economic activity as the Covid-19 pandemic ripped through the country. Unfortunately, there is little sign of this situation improving, at least over the short term, as infection rates continue to rise and large swathes of the British Isles remain under strict social and commercial controls. For small businesses, this is a disaster. Pressures on balance sheets are piling up, while opportunities for growth appear almost non-existent in many sectors. Coupled with the uncertainty surrounding the immediate future relationship between the EU and the UK, which will involve some form of economic hit whatever shape it takes, the outlook is bleak.
But this crisis has also exposed salient and positive improvements to the operating landscape for SMEs. Relative to the 2008 financial crisis, when established banks were the only game in town, a new generation of fintech lenders now populate the credit landscape for the country’s small and micro-sized businesses. The arrival of this new cohort of lenders, which have appeared in greater numbers throughout the past decade, has opened up a vital new avenue of finance for enterprises underserved by traditional banks. In the coming years, as the UK emerges from its latest economic crisis, these fintech lending specialists are likely to provide vital support for a new generation of small businesses.
Beyond this, however, is the UK’s world-leading complaints and dispute resolution services for SMEs. Having learnt the lessons from the global financial crisis, the UK authorities have enhanced the complaints procedures for small businesses against the banks from which they borrow, offering dispute-handling mechanisms that avoid expensive litigation. The breadth of this coverage is impressive, as it covers fledgling enterprises to medium-sized entities. This has drastically improved the operating landscape for many and has positioned the UK as one of the most business-friendly markets in the world. This is vital because if the country is to secure a brighter economic future for itself, amid a global pandemic and a changing economic partnership with its largest trading partner, it will be built on the back of SMEs.
