In a tough economic context, in which obtaining finance for a business is incredibly difficult, what is the next step if an entrepreneur has exhausted all their alternative options? Well, according to a recent report by the commercial banking arm of Santander, most entrepreneurs who have been refused finance rely on their own personal savings and credit to keep their businesses a float.
The report found that during the economic downturn, entrepreneurs have invested over sixteen billion pounds of their own money into their businesses.
Of all the entrepreneurs asked, one in five said they have relied on their own savings and credit to get their businesses through tough market conditions, almost sixty per cent said they took a pay cut , while over 30 per cent said they plan to invest more over the next year
“Small businesses owners are the backbone of the UK’s economy”, comments Santannder’s enterprise manager William Walker. “The last two years have been extremely challenging for all business, but it has been especially tough on the small business sector and bosses have been forced to take huge financial risks to secure the survival of their business and the jobs of their staff.”
“However, despite the economic difficulties of the past year, most entrepreneurs went into 2010 optimistic about the future and looking forward to building on what they achieved during the recession.”