As the credit crunch bites, businesses are seeing steeper borrowing costs being passed on by the banks. Credit is also much harder to obtain, as banks become increasingly reluctant to take on more risk.
However, a survey, conducted by the Asset Based Finance Association (ABFA), found that 74% of companies are refusing to put growth ambitions on hold!
As a result of the credit crunch businesses will need to hold onto whatever cash they can, so financing becomes a more sensible option. It only takes one customer's bad debt to send your customer’s cashflow into a spin.
It’s important we don’t see the credit crunch as a threat; it’s an opportunity to talk to our customers about their situation.
"Yes the credit crunch is a worry, but it is great to see that small business owners
can still find ways of making the best of a tough economic climate."
Mike Cherry, Federation of Small Businesses Financial Affairs Chairman