North West SMEs fear exchange rate volatility ahead of Brexit referendum

The majority of North West-based SMEs making cross-border payments are concerned they will impacted by the upcoming referendum on the UK’s membership in the European Union.

In a nationwide survey carried out by currency transfer firm World First, 72% of the North West’s small- and medium-sized businesses said they fear currency volatility from the Brexit vote will affect growth and profitability.

A further 40% of survey respondents in the region said they are failing to take notice of foreign exchange markets, while 43% said they do not believe having a currency strategy is important.

Elsewhere, the research found that North West SMEs remain exposed to the effects of currency fluctuations. Half (50%) reported being “caught out” by sudden movements in exchange rates, while just over a fifth (22%) said they have been “severely impacted” by previous market volatility.

World First’s CEO, Jonathan Quin, said of the findings: “Given that SMEs are the engine-room of the UK economy and key to our international trade, more needs to be done to ensure they are adequately protected from currency swings caused by events such as the EU Referendum.

“Supporting UK SMEs on the journey to become mini-multinationals is at the heart of the government’s plans to rebalance the economy and to drive the competitiveness of our exporters.”

He added: “Therefore, collectively, the industry and policy makers need to better educate businesses on the benefits of a well-managed currency strategy, as well as providing specialist advice and products that can help our nation’s business thrive on the international stage.”

The survey collated the opinions of more than 1,000 senior decision makers at SMEs across the UK.