More than 50% of UK small and medium-sized enterprises (SMEs) are planning to apply for the newly launched Recovery Loan Scheme to improve their cashflow situations.

A survey conducted by Purbeck Personal Guarantee Insurance that spoke to 1,000 owners of SMEs reveals that 54% of them are planning to apply for one of these loans, and they plan to use it to improve business cashflow. This survey also found that a smaller percentage of them – 22% –are aiming to borrow more than £250,000 via this scheme. These business owners intend to become the guarantors for their loans themselves.

The Purbeck survey certainly confirms that the Recovery Loan Scheme is central to the 2021 planning of many SMEs, with 54% stating that they view it as the most important financing option. A total of 28% see credit cards as the main option, and 19% named a bank overdraft facility.

Other funding sources that were considered the most important by smaller numbers of SME owners included asset financing (13%) and family or friends (12%).

Todd Davison from Purbeck pointed out to Peer-to-Peer Finance News that, while the majority of smaller firms are counting on the loans for funding this year, the limited lender numbers and strict eligibility criteria could lead to many of them being unsuccessful with their claims.

Accountants in Goole or anywhere else that have a track record in supporting small businesses could be able to help firms that find themselves in that position to secure alternative sources of funding over the coming months.