Capify Survey Reveals that 70% of UK SMEs are Bouncing Back after COVID-19 related Challenges

Over 70% of UK SMEs claim that they’re beginning to bounce back following the COVID-19 outbreak, according to a survey performed by Capify, a small business lender backed by Goldman Sachs (NYSE:GS).

The Capify survey, released earlier this week, found that the United Kingdom’s small to medium-sized businesses are recovering “strongly” as Coronavirus-related restrictions “continue to ease.”

As mentioned in the update shared with CI, 45% of UK SMEs say they have “already hit or surpassed pre-Covid levels of turnover, with a further 26% expecting to return within one year.”

The results also indicate that alternative lenders are increasingly being used “to finance businesses just as much as traditional banks.” As stated in the update, more than 70% of UK SMEs are “making strong post-pandemic recoveries, according to a new study investigating the impact of Covid-19 on small businesses.”

Only a few weeks on from the relaxation of COVID-related restrictions on July 19, 2021, around  half of SMEs said they are well on their way to bouncing back after the challenges created by the pandemic.

Over 250 SMEs were involved in the survey by Capify, which also highlighted how 48% of UK companies had “adapted their business models in some way to survive during lockdown.”

Launching online sales (38%) and adopting new services or products (38%) were “the two most popular answers,” the survey’s findings revealed.

As mentioned in the update from Capify:

“The findings also made good reading for employment statistics, with over 50% of SMEs making no permanent cuts to their number of staff over the past 12 months, despite 64% using the Coronavirus Job Retention Scheme (CJRS) during the pandemic.”

The announcement further noted that the second “most popular” Government-backed support used was the Bounce Back Loan Scheme (BBLS), which was “taken up by 55% of SMEs.”

The release also mentioned that the important role of alternative lenders alongside traditional banks through the pandemic was highlighted, “with 41% saying they would look to traditional lenders for future loans and finance, closely followed by alternative finance companies at 39%.”

And with the survey determining that one in three or 33% of businesses “expect to need finance during the next 12 months,” John Rozenbroek, CFO/CCO at Capify says “the need for a range of financial options to support the UK’s economic recovery is clear.”

He added:

“It’s fantastic to see that the majority of UK businesses are enjoying strong performances following the easing of lockdown restrictions, with many reaping the rewards of adapting their business models during the pandemic.”

He further noted:

“The CJRS and BBLS clearly played important roles in keeping SMEs ticking over, but it’s also important to note that many small businesses went without much government support, having fallen through the gaps of various support schemes. Alternative finance has played a huge part in propping up and supporting businesses through the challenges of the last 18 months, and our data show that as an industry, it is now being considered by SMEs just as much as traditional lending options like high street banks.”

Even though lockdown restrictions have been eased, the Coronavirus crisis has continued to negatively affect SMEs with 54% of survey respondents saying “uncertainty over the future will be their number one challenge during the next 12 months.”

John also noted:

“There is still a long way to go on the road to recovery for SMEs, even following the end of financial support from the Government, which is why alternative lenders like ourselves will need to be working closely with them SMEs make up an incredible 99 per cent of the UK’s business population, and have companies across so many sectors have proven their resilience repeatedly, so it’s crucial for the economic recovery that SMEs continue to grow and succeed.”

The Capify SME confidence survey “received over 250 responses from UK SMEs across a wide range of sectors, including Construction, Manufacturing, Agriculture, Motor trades, Restaurants, Professional Services and Transportation.”

Capify is an online lender that offers flexible financing solutions to SMEs “seeking working capital to sustain or grow their business.” The Fintech firm has been “operating in the UK market for over 13 years and also has a sister company, Capify Australia, which provides similar services to Australian SMEs for over 13 years. “

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