SMEs urged to seek funding help from accountants

Accountants must step into the breach and work more closely with smaller businesses, many of which may not be aware of the recently proposed changes to the government-backed Small Firms Loan Guarantee Scheme, the Treasury has been told.

The report by Baker Tilly partner Teresa Graham ð aimed at improving the scheme ð made 38 recommendations that include increasing the turnover of eligible businesses to £5.6m and raising the lending limit from £100,000 to £250,000.

According to Alison Small, a director at Venture Finance, one of the organisations authorised to provide the loans, accountants can offset the loss in revenues from the increase in the audit threshold by providing advice.

‘The role of accountants is changing,’ said Small. ‘They have to have a much more consultative role with smaller businesses ð such as providing business advice to clients.’

She also sees accountants playing a central role in checking the viability of SMEs looking to apply for the loans, which would give the likes of Venture Finance ‘a great deal of comfort’ when dealing with loan applications.

‘Venture Finance may see a proposition [from an SME requesting a loan], but before dealing with them we pass them onto accountants,’ she said.

A spokeswoman for the department of trade said that it was currently working with banks to go through the report’s recommendations and examine how they could be ‘applied practicably’.

The DTI will issue a statement of its intentions in the next few weeks. ‘We are trying to remove red tape and let banks make the decisions about whom they lend the money to,’ said the DTI spokeswoman.

‘We will steer the banks, rather than deciding for them and dealing with everything on a loan-by-loan basis.’

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