The Government today announces that small businesses which have funding applications rejected by established banks will be automatically referred to alternate finance providers. Nine of the UK’s largest banks have agreed to pass on the details of small firms they refuse to finance to funding platforms Funding Xchange, Business Finance Compared and Funding Options. The three platforms will then facilitate conversations between the small companies and interested finance providers. FSB has been calling for this form of support for small businesses since the release of its agenda-setting ‘ALT+ Finance: Small firms and access to finance’ report and the passing of the Small Business Bill last year. Access to finance is a pressing issue for small firms. The latest research suggests that 71% of businesses seeking finance approach only one lender and, if rejected, many give up on securing investment rather than seeking alternative options. FSB’s most recent Small Business Index shows that alternate finance is an important lifeline for small firms. There was a substantial increase in applications for asset-based, invoice-based or trade financing in Q3. Today’s announcement is a welcome step towards ensuring all small businesses are aware of the finance options available to them. Mike Cherry, National Chairman, Federation of Small Businesses, said: “Small firms struggling to access finance will now automatically have a new way to get the support they need to invest and grow. FSB pushed hard for these reforms, and today’s announcement is good news as the government delivers on them. This change will boost alternative lenders, bringing more competition and choice in the market beyond the big banks.” Today’s announcement from HM Treasury can be read here. See how FSB have campaigned on this issue You may also like 17 November 2017 Weekly Brief 47 – Friday 17 November 2017 16 November 2017 Grand Designs of Perthshire member John Langley 10 November 2017 Weekly Brief 46 – Friday 10 November 2017 10 February 2017 Where are Scotland’s most entrepreneurial places? 28 July 2016 Quarterly tax proposals would hit crofters 31 March 2016 What 4 things should the next Scottish Government do to get Scotland into the digital fast lane?