New research has revealed that British SMEs are owed more than £500 billion in outstanding invoices, an increase of more than 70% in two years.
The latest Lloyds Bank Commercial Banking Business in Britain research also found that the problem is likely to get worse during 2016, with almost 30% of small businesses expecting more of their customers to demand deferred payment terms in the next six months.
UK SMEs also own almost £2.5 trillion of assets that could be used to fund further growth, again a huge 220% increase on 2014, when Lloyds Bank found that small and medium-sized businesses owned a total of £770 billion in assets.
Together, the figures suggest that a lack of understanding of alternative funding options is holding British businesses back, says Lloyds.
Businesses in Sussex, Surrey, Hampshire and Dorset were apparently owed the most in outstanding invoices (£109,000 on average), while those in Scotland were owed the least (£79,000). Those in London and Essex owned the most valuable assets (£670,000) but owned the lowest proportion of those assets outright (72%).
The research also found:
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