Over one million sole traders have had their applications rejected and one-third have been declined for a bank loan according to research carried out by Amigo Loans.
40% of 500 business owners who were surveyed said that they have been left with no option but to borrow money from family and 30% asked their friends for help. Despite the high fees, 42% of business owners have had to extend or make a dent into their overdraft just so that their business can stay afloat.
The knock backs are becoming increasingly off-putting, as one in twenty who had their application for a bank loan refused have not bothered looking elsewhere. A potential reason for this is because they’re unsure of their options. – Because of this, approximately 73,000 start-ups did not start-up!
Glen Crawford, CEO of Amigo Loans has said;
“It’s a disgrace that the people who keep our society operating, the mobile hairdressers, the wedding photographers, cleaners, café owners, mechanics, driving instructors and a whole host of other ambitious sole traders are being alienated by banks – the bankers have forgotten why they exist.”
Head of Businesscomparison.com, Philip Brennan has commented saying;
“Business owners really need to be aware of their alternative options surrounding them, although funding is key for a business it shouldn’t be a reason for their delay or failures. Many prefer to go through their bank because of the trust they have with them, but going via your bank can become expensive and there is a chance of getting declined.”
Businesscomparison.com offers a comparison journey which lands businesses with their best options and deals. If your business is ready to start but cash flow is keeping you back, then use our finance finder which will help you and your business set sail.