FINANCING SMALL AND MEDIUM BUSINESSES: THE BRITISH EXPERIMENT

Abstract

Financing any business project anywhere in the world is the biggest hurdle that faces its owner. Most businesses whether small or large require finance at some point, whether at the outset or at a later stage and whether in the form of a bank loan, an overdraft, a grant, an equity funding or a combination of these. Finance is the blood that flows in the veins of economic institutions and helps them face the challenges they encounter, However, if the sources of finance are limited or difficult to secure or if there are other hurdles such as the lack of security and stability, this will definitely have adverse effects on all aspects of life, not only the economic but the social, the political and even the cultural. The aim of this paper is to shed some light on financing small and medium businesses in the UK, the different sources of finance available them, and how easy or difficult to secure this finance. But before this, a brief overview will be given on the importance of the small and medium business sector in the United Kingdom, the role that this sector plays in the British economy, the problems it faces and the facilities put at its disposal. This is done through an expose of some data and other information on this important sector and a discussion about its impact on the national economy especially in creating new additional jobs, creating new investment opportunities, creating new and varied products, increasing competition, and contributing to the wellbeing of the British society.