Small businesses in the UK are thriving. In fact, 99% of all enterprises in the country are classified as a 'small business', and they account for 48% of total employment. This is a huge number, representing an important driving force in the country's economy.
However, many UK businesses are still dealing with the aftermath of the last global economic recession, and the vote to leave the EU has also had an impact. Added to this, rising inflation and slow economic growth all combine to make it difficult for small businesses to thrive.
Lack of government support
Entrepreneurs and small business owners are worried that Brexit may have a lasting impact on large corporations and banking institutions, which are already making it more difficult for small businesses to obtain loans.
Despite these problems, the government continues to fail to provide overreaching support for small businesses. Despite some regional policies, there is still a lack of clear planning on how to ensure that these enterprises can overcome their challenges.
Microfinance and its benefits
The idea of microfinance - small loans offered at a manageable interest rate to help low-income entrepreneurs get their ideas off the ground - has become an instant hit. The possibility of getting finance, which the applicant may be unable to access elsewhere, and of using this to become more financially stable is what sets microfinance apart from other alternatives.
The opportunity also helps entrepreneurs to become more fiscally responsible. Given how difficult it is to get a bank loan these days, having this chance is already a big deal. It is just up to business owners on how they will use it to their advantage.
Of course, getting microfinance does not guarantee success. It is still a loan, after all. It has to be repaid, and your ability to do so depends on how you manage your business. The point is that despite the current economic climate in the UK, microfinance represents a lifeline for UK entrepreneurs to start their own business or keep it running. Sharone Perlstein's article will help you understand the process better and will demonstrate how microfinance has helped many people not just in the UK, but around the world.
A bright future?
Given how microfinance is changing the landscape of business financing, with a growing number of success stories, small business owners can feel optimistic.
However, problems clearly still exist, and the government still needs to introduce legislation to combat the impact of recession and help small business owners. After all, a huge percentage of the country's employment depends on them.
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