London SMEs 'faring worse than other regions' - commercial mortgages

17 February 2009

Small and medium-sized enterprises (SMEs) in London are faring worse in the economic downturn than those in other regions of the country, according to new figures.

But firms in the north-east and Scotland appear to be bucking the trend and enjoying "healthy" sales growth, according to research by the Finance and Leasing Association.

The study showed that SMEs all over the UK are becoming increasingly worried about cashflow, debtors and payments, something that could have implications for those with commercial mortgages.

Of the businesses questioned in the poll, 55 per cent said they have taken out a loan, while asset finance such as leasing or hire purchase have become more prevalent methods of funding acquisitions.

Director general Stephen Sklaroff noted that SMEs, particularly those based in the capital, are facing "tough credit conditions and finding it difficult to get their bills paid on time".

Meanwhile, over 60,000 firms have benefited from a "cashflow boost" thanks to the government's business payment support service, HM Revenue & Customs has revealed.