UK SME Confidence Hit by Triple-Whammy of Double-Dip Recession, Global Economic Worries and Access to Credit
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UK SME Confidence Hit by Triple-Whammy of Double-Dip Recession, Global Economic Worries and Access to Credit

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3 Pages
English

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UK SME Confidence Hit by Triple-Whammy of Double-Dip Recession, Global Economic Worries and Access to Credit PR Newswire LONDON, June 12, 2012 LONDON, June 12, 2012 /PRNewswire/ -- Confidence falls in May following news of a double-dip recession 81 percent of SMEs see no improvement in credit availability Little boost expected from the Olympic Games Exports to emerging markets offer a glimmer of hope The confidence of Britain's small and medium sized importers and exporters has nosedived. The latest data from the Western Union Business Solutions International Trade Monitor (ITM) released today revealed UK SME confidence has re-entered negative levels. In the period March to May 2012 rising SME confidence in the UK economy dropped from 58 percent in April (the highest figure recorded since June 2011) to 49 percent in May. The fall followed the announcement that the UK is in a double-dip recession. SME importers and exporters in London were the hardest hit, with their confidence dropping from 60 percent to 40 percent over the same period. Neil Graham, Managing Director, UK, for Western Union Business Solutions, says: "SME confidence has dropped from the cautious rebound we saw last quarter. News of the UK entering a double-dip recession was a big blow; London confidence in particular has taken a bath. "The fall in confidence levels back to negative territory is very worrying for the UK economy.

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UK SME Confidence Hit by Triple-Whammy of
Double-Dip Recession, Global Economic
Worries and Access to Credit
PR Newswire
LONDON, June 12, 2012
LONDON
,
June 12, 2012
/PRNewswire/ --
Confidence falls in May following news of a double-dip recession
81 percent of SMEs see no improvement in credit availability
Little boost expected from the Olympic Games
Exports to emerging markets offer a glimmer of hope
The confidence of
Britain's
small and medium sized importers and exporters
has nosedived. The latest data from the
Western Union Business
Solutions International Trade Monitor
(ITM) released today revealed UK
SME confidence has re-entered negative levels.
In the period March to
May 2012
rising SME confidence in the UK economy
dropped from 58 percent in April (the highest figure recorded since
June 2011
)
to 49 percent in May. The fall followed the announcement that the UK is in a
double-dip recession. SME importers and exporters in
London
were the hardest
hit, with their confidence dropping from 60 percent to 40 percent over the
same period.
Neil Graham, Managing Director, UK, for Western Union Business
Solutions, says:
"SME confidence has dropped from the cautious rebound we saw last quarter.
News of the UK entering a double-dip recession was a big blow;
London
confidence in particular has taken a bath.
"The fall in confidence levels back to negative territory is very worrying for the
UK economy. SMEs have to contend with the prospect of a return to recession
at home and increasingly turbulent markets abroad."
Credit woes
Access to credit continued to add to SME worries; the ITM revealed that 81
percent of SMEs have seen no improvement in credit availability. The launch of
the Government's National Loan Guarantee Scheme seems to have made little
impact. 52 percent of SMEs are aware of the programme, an improvement of
11 percent over awareness of Project Merlin last quarter. 77 percent believe
that it will make no difference in their ability to obtain credit.
Additionally, only 17 percent of SMEs believe credit in general is easier to obtain
now than it was a year ago while their likelihood to renew or request lines of
credit has fallen to ten percent - the lowest figure recorded thus far.
Graham continues:
"The continued lack of credit available to small businesses
is a real challenge. Despite the Government's efforts, over 80 percent of SMEs
haven't noticed an improvement in credit over the last year - a year that has
not been noted for great access to credit in the first place. Liquidity remains a
big challenge for small businesses as their cash flow continues to dry up."
Hopes of Olympic boost fail to materialize
SMEs do not expect to benefit from the Olympic Games, with only 15 percent
believing they will have a positive impact on their business. 67 percent believe
they will have no impact, with eight percent expecting a negative one. SMEs in
London
were slightly more optimistic, with 20 percent indicating the Games
would have a positive impact on their business. 60 percent of the capital's SMEs
expect no impact, 11 percent a negative one.
Exporters with customers in emerging economies
increase
Despite falling confidence in trade conditions there are signs the Government's
efforts to boost exports are yielding results, particularly in the manufacturing
and wholesale industries.
Exporters with customers in
Africa
rose six percent compared to the previous
quarter and those with customers in
India
increased by four percent, indicating
exporters are looking for opportunities outside of the eurozone. In addition to
this, exporters with customers in
Brazil
and other countries in
South America
recorded a three percent rise.
Graham continues:
"The Government's efforts to boost exports are welcome
and seem to be yielding positive results. With continuing economic turmoil on
the cards, however, our customers are looking for ways to protect themselves
as much as possible. It's no wonder that they are feeling anxious. The situation
in
Europe
is precarious and what happens there will of course impact the global
economy."
Notes to Editors:
About Western Union Business Solutions
Western Union Business Solutions enables companies of all sizes to send and
receive international payments and manage foreign exchange,
creating
unique solutions tailored to suit their FX needs.
It is a business unit of
the Western Union Company (NYSE: WU), a leading nonbank provider of cross
border payments, which operates its Business Solutions services through locally
licensed affiliates in 25 countries. Supported by a network of trading offices,
strategic banking relationships
and a global clearing network,
businesses
can send cross-border payments in more than 135 currencies.
© 2012
Western Union Holdings, Inc. All rights reserved.
Western Union Business Solutions services in the UK are provided by Custom
House Financial (UK) Limited or Travelex Global Business Payments. Custom
House Financial (UK) Limited (registered in
England
, Company Number
04380026, Registered Office Address: 2nd Floor, 12 Appold Street,
London
EC2A 2AW) is authorised by the Financial Services Authority under the Payment
Services Regulations 2009 (Register Reference: 517165) for the provision of
payment services and is registered as an MSB with HM Revenue & Customs
(Registered No: 12140130).
Travelex Global Business Payments Limited
(registered in
England
, Company Number 02854737, Registered Office Address:
65 Kingsway,
London
, WC2B 6TD) is authorised by the Financial Services
Authority under the Payment Services Regulations 2009 (Register Reference:
536611) for the provision of payment services and is registered as an MSB with
HM Revenue & Customs (Registered No: 12122416).
"Travelex" is a registered trademark of Travellers Exchange Corporation
Limited and is used by Travelex Global Business Payments Limited and its
affiliates under license
About Western Union
The Western Union Company (NYSE: WU) is a leader in global payment
services. Together with its Vigo, Orlandi Valuta, Pago Facil and Western Union
Business Solutions branded payment services, Western Union provides
consumers and businesses with fast, reliable and convenient ways to send and
receive money around the world, to send payments and to purchase money
orders. As of
April 24, 2012
, the Western Union, Vigo and Orlandi Valuta
branded services were offered through a combined network of approximately
500,000 agent locations in 200 countries and territories. In 2011, The Western
Union Company completed 226 million consumer-to-consumer transactions
worldwide, moving
$81 billion
of principal between consumers, and 425 million
business payments. For more information, visit http://www.westernunion.com.
Jennifer Berlin
Western Union Business Solutions
T: +44(0)208-415-4204
E: Jennifer.Berlin@Travelex.com
Lauren Franze/George Parrett
Redleaf Polhill
T: +44(0)20-7566-6750
E: wubs@redleafpolhill.com