Business Finance Survey 2025 (British Business Bank)

Summary

• One quarter (24%) of SMEs sought external finance in the last three years, down from 26% in 2024 and 30% in 2023.p.10
• The median amount of finance sought was £17,375, and 38% of SMEs who sought finance wanted facilities of £25,000 or more.p.13
• 82% of SMEs seeking finance obtained all or some of what they needed from the first provider.p.16
• 62% of SMEs reported knowing where to obtain information on external finance types and specific providers.p.21
• 32% of SMEs were already using AI or planning to use AI capabilities in the next 2 years.p.30
• Only 5% of SMEs measured, monitored, or reported their carbon emissions, while 10% intended to start doing so.p.37

Key insights

1. 1. Two in five SMEs (41%) expected their turnover to grow over the next 12 months, returning to 2021 levels.p.8
2. 2. Private lending or finance company lending was the finance type most commonly sought on the last occasion at 25%.p.11
3. 3. Working capital (50%) and business growth (43%) were the top reasons for SMEs seeking external finance.p.12
4. 4. Four in five (80%) SMEs that accepted a finance offer were not concerned about their ability to make repayments.p.18
5. 6. One in five (20%) SMEs were considering applying for external finance in the next 12 months.p.23
6. 7. Among SMEs considering finance in the next 12 months, bank loans (22%) and government grants (21%) were the most common options considered.p.24
7. 9. Current economic conditions (46%) and regulatory uncertainty (42%) were cited as the primary obstacles to becoming environmentally sustainable.p.36