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Repairing the UK’s Regional Funding Gap



Norman Chambers, MD at the NACFB, examines the role brokers play in addressing UK lending disparities 

Some 3.7 million UK private sector businesses are located outside of London and the South East. Manchester alone has seen SME growth rise by over a third since 2010, but data from the British Business Bank released this year outlined that SMEs in London still received more funding than the rest of the UK combined. 

Additionally, no region outside of London and the South East has yet seen GDP per capita return to its pre-crisis peak. It is clear that improving the supply and demand for finance among high-growth firms in all regions could help to deliver better economic outcomes nationally and reduce regional inequalities.

The government is also making inroads to address the disparity in the regional funding gap. Initiatives such as the Midlands Engine Investment Fund – a £250m fund to help SMEs across the Midlands get the finance they need to grow – and the Northern Powerhouse Investment Fund, a £400m fund aimed at helping SMEs in the North of England achieve their growth ambitions.

Beyond regional funding disparities an additional challenge facing the UK commercial finance community is that enterprises will still largely turn to their main bank for finance and are less aware of the myriad of alternative funding options available to them. 

Brokers have a role to play in addressing this funding and knowledge gap which is why, as the largest independent trade body in the sector, the NACFB chooses to host its annual Commercial Finance Expo outside of the South-East in the Midlands, on Wednesday 20th June at Birmingham’s NEC.

The free event, the largest of its kind on the commercial finance calendar, is open to anyone with an interest in commercial finance and its strategic location is optimised to enable more brokers from across the UK to engage with the 130 exhibiting lenders and funders. 

Intermediaries remain valuable allies for lenders in the effort to match ambitious small firms with the right kind of growth capital. Our members see small business clients increasingly asking them for information about alternative types of funding and the NACFB Expo is the ideal forum for brokers to upskill themselves on the range of new products available.

Devolving from the South East and decentralising funding will be necessary for the UK to face Brexit uncertainties with confidence. We believe the regional funding gap can be closed and the modern commercial finance broker has a crucial role to play in to ensure that SMEs across the UK are offered the fullest range of options to help their businesses prosper.

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