Why we must praise the resilience of Yorkshire's small firms as they rose to the challenges of the pandemic - Stephen Pegge

In order to understand what SMEs think, UK Finance works with an independent research company (BVA BDRC) who regularly survey them as part of the SME Finance Monitor.

The BVA BDRC spoke to nearly 18,000 of these businesses across the whole of the UK and its findings are contained in the latest SME Finance Monitor Annual Report for 2020.

Since 2011 more than 170,000 interviews with SMEs have been carried out, making it the largest and most frequent survey of its kind in the UK.

Overall, it found that 82 per cent of SMEs in Yorkshire reported making a profit in the previous 12 months, which was slightly above the UK national average.

The survey also found that 41 per cent of SMEs in Yorkshire said they had been innovative which was in line with the UK national average including 15 per cent that said they had developed a new product or service.

The overall level of SME innovation was the highest proportion recorded to date in the SME Finance Monitor and demonstrates how the pandemic has led to businesses taking tough, but hopefully beneficial decisions for the long term.

SMEs in Yorkshire are more likely to be using business funding in some form, with those that did apply for finance more likely to have been offered the banking facility they wanted.

In fact, last year 92 per cent of firms in the region who applied for finance were successful in obtaining the finance they needed.

As the economy begins to further open up, many businesses are looking beyond surviving to finding ways to thrive in the months and years to come.

Nearly half of SMEs in Yorkshire said they planned to grow in the coming year, with around a fifth planning to grow by 20 per cent or more.

Firms nationwide who were looking at growth said they were planning to either take on more staff, develop a new product or service, or invest in new plant, machinery or premises.

These are encouraging signs as SMEs are the lifeblood of many local communities.

These positive signals about activity returning and the economy reopening has resulted in tangible gains that can be seen in official data.

A recent update from the Office for National Statistics has shown that the UK economy grew by 4.8 per cent in the last quarter, broadly in line with forecasters’ expectations.

The largest sector contributors to this increase were wholesale and retail trade, accommodation and food services all of which are well represented by SMEs.

The banking and finance industry has provided close to £80bn worth of lending to businesses through the various government-backed loan schemes, including £5bn across Yorkshire.

Now as some of the government support schemes begin to taper off, the industry stands ready to provide SMEs with the access to finance to help them and drive the ongoing economic recovery.

By Stephen Pegge - Managing Director of Commercial Finance at UK Finance

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