Partner Article

Credit crunch affects SME cash flow

Small business owners and social entrepreneurs are now finding it harder to secure finance as a result of the global credit crunch crisis. Research by UnLtdWorld.com - a social entrepreneur networking website - found that about 40% of small business owners and social entrepreneurs experienced cash flow problems in the last few months as a result of the worsening economic situation.

Along with facing cash flow difficulties on a day-to-day basis, small business owners are finding it harder to secure finance with 68% of those business owners who had recently applied for a business loan or credit card being turned down.

More than 20% said that their business had been badly affected by the recent financial problems in the UK such as a training, research and consultancy company who has faced difficulties in its industry due to a reduction in buyers’ budgets. 34% of the business owners who replied said they had used personal loans and credit cards to fund their growth and start up costs.

Alberto Nardelli, chief strategist for UnLtdWorld, said: “We wanted to get a better understanding of the real financial position faced by many small business owners and social entrepreneurs. To some extent, the outlook seems quite bleak for now.

“We had noticed an increase in discussions relating to financial difficulties across our social networking site and the research has presented us with a really clear picture of the extent of the issues.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .