Why crowdfunding is increasingly popular for SME financing

British FlagAs SMEs struggle to access traditional funding, this year crowdfunding could provide over £200m of Small and Medium Enterprise financing.

As a child, I loved the story my grandfather told me about the commanders who, about to go to war, sent a verbal message down the line to HQ. “Send reinforcements, we are going to advance.” On the way, it got lost in translation. The message HQ received was “Send three [shillings] and fourpence, we are going to a dance!”

Today this tale resonates in the context of small and medium enterprise (SME) funding. At the front line, government has told bankers to drive economic growth by lending to SMEs. Investors and businesses have been given a smorgasbord of tax breaks, including the new Seed Enterprise Investment Scheme (SEIS) and the Patent Box, to encourage them to invest. New initiatives such as the British business bank, are receiving air time.

Nevertheless it isn’t proving an easy battle to win. SMEs cannot or are not borrowing. According to the Bank of England, lending to SMEs in the three months to November contracted, by around £4bn.

Read More at the Guardian



Sponsored Links by DQ Promote

 

 

Send this to a friend