UK small businesses are starting to feel the pressure from the credit crunch as banks start to tighten their belts over business loans.
Mark West of London-based Berley Chartered Accountants told SmallBusiness.co.uk that UK small businesses are struggling to raise funds as unsecured borrowing is becoming increasing difficult to find.
He said many business owners are starting to put personal assets on the line to protect the future of their companies, but as many cannot afford to risk personal assets, they face the prospect of business decline or even bankruptcy.
"The credit squeeze has given lenders the opportunity to compel SME’s and specifically the directors, to provide personal guarantees to secure the corporate borrowings of their business, clearly at a time they need the most help," West explained. "Higher costs, a slowdown in the economy and rising inflation is causing more companies to suffer, with cash flow the most critical factor in their survival."
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