Rising Interest in Funding for Business Expansion

The most recent survey carried out by Allica Bank has unveiled a notable increase in the number of small and medium-sized enterprises (SMEs) seeking financial assistance for business expansion. The survey, which engaged commercial mortgage brokers, revealed that 44% of them reported a surge in demand for finance from their clients. Additionally, a third of the brokers noted a minimum of 10% increase in applications.

The rationale behind this surge in funding requests varied. Half of the brokers attributed the rise to a growing number of businesses seeking finance to invest in the growth of their operations. Meanwhile, 43% of the brokers mentioned that more businesses were looking to acquire their own business premises, and just over a third (36%) cited business owners seeking to invest in commercial properties.

Despite the overall increase in funding applications, approximately a third of the brokers observed no change in the volume of applications over the past six months. Conversely, nearly a quarter (23%) of the brokers noted a decrease in demand, which they attributed to rising interest rates and increased costs.

Charissa Chang, the head of sales North & Midlands at Allica Bank, highlighted the challenges facing SMEs in the current economic climate. She emphasized the importance of brokers in guiding SMEs through the funding market, especially amidst high interest rates and pressure on operating margins.

Chang emphasized the resilience of businesses in their unwavering commitment to invest in growth and commercial property, despite the challenging economic conditions. She underscored the essential role that both banks and brokers have to play in supporting the ambitions of businesses seeking financial backing for expansion.

The survey reflects the evolving landscape of SMEs seeking financial support, indicating a positive outlook for business expansion and investment in commercial properties. It also underscores the critical role of financial institutions and brokers in facilitating funding for businesses striving for growth and expansion.