Reward Funding – BoE Interest Rate Comments
With the Bank of England recently increasing interest rates, businesses will inevitably think more carefully about how and why they borrow. But, that doesn’t mean demand for SME finance disappears. It means funding needs to work harder.
SMEs will think longer and harder about what finance needs to achieve. They’ll prioritise funding that serves an undeniably clear purpose, whether that’s improving efficiency, taking advantage of a time-limited opportunity, unlocking capacity or supporting expansion.
At Reward, we build long-term partnerships with our clients, looking beyond the headline numbers to understand the wider business, its objectives and the opportunities ahead. When borrowing costs are higher, SMEs need funding that works harder for them, and a lender that understands what they’re trying to achieve.
“The interest rates rise is another layer on top of the already challenging climate for UK businesses. Inflation is being driven upwards by factors like the ongoing conflict in Iran and rising energy prices, while the government is still struggling to establish the consistent growth needed to give businesses confidence.
“We hear a lot about the importance of economic growth, but businesses need more than talk. They need an environment that encourages investment, rewards entrepreneurship and gives them the confidence to plan for the long term. Instead, many SMEs are having to navigate rising costs, higher borrowing expenses alongside ongoing uncertainty.
“The danger is that SMEs become so focused on managing the immediate pressures that investment and growth take a back seat. That’s not good for individual businesses or the wider economy as a whole. We need to ensure that viable, ambitious businesses can still access the funding they need to invest, adapt and grow.
“At Reward, we believe it’s more important than ever to look beyond the headline numbers, understand the fundamentals of a business and recognise the opportunities that exist. Whatever the economic backdrop, we’re here to back SME ambition.”