credit crunch

Credit Crunch

West Midlands firms given cash boost

The Government has set up a £4 million loan fund to help struggling small firms in the West Midlands survive the credit crunch. According to the Department for Business, Enterprise and Regulatory Reform (BERR), the fund is designed to help small and medium–sized enterprises (SMEs) overcome short–term funding problems. Loans of between £50,000 and £250,000 are available to established businesses for a maximum period of three years. The fund is being provided by Regional Development Agency Advantage West Midlands. Eligible firms can apply for funding straight away. Business Secretary Lord Mandelson said: “Access to finance is crucial for businesses to survive. With this fund, local firms can access the money they need to weather the economic storm and come... »

Credit Crunch Spurs Spare Room Business Start Ups

Credit Crunch Spurs Spare Room Business Start Ups

The current economic climate is acting as a spur for thousands of people to become their own boss and to run their own start up businesses from home, according to a report by Enterprise Nation and BT. The 2008 Home Business Report (1.1Mb PDF) from last month’s Small Business Week 2008, highlights a 16% rise over the last year in the number of businesses being run from home. There are now more than 2.5 million home businesses, accounting for more than half (53%) of the 4.7 million small and medium sized enterprises in the UK. Home based businesses are also bucking the trend when it comes to confidence in their prospects during the financial crisis. They are buoyantly optimistic about beating the adverse economic conditions, with 72% planning to win new customers over the next six mont... »

Online tool offers Insurance Comparisons

Online tool offers Insurance Comparisons

Small firms can compare insurance quotes quickly and easily following the launch of a free business insurance search tool from Comparethemarket.com. The new service allows firms to search for quotes by category — such as for offices, tradesmen or retailers. It also allows users to search for specific insurance products, such as public liability, business interruption and buildings insurance. Comparethemarket.com insurance spokesman Jeremy Moll said: “With many small and medium–sized businesses feeling the wrath of the credit crunch on a daily basis, they will be looking to make financial gain wherever possible,”. “Having business insurance is a necessity and our new service helps time–poor businesses search quickly through a number of products from a var... »

Bank

Small firms benefit from Bank Bail-out

Small businesses will have better access to finance from Lloyds TSB, HBOS and Royal Bank of Scotland (RBS), following the Government’s £37 billion bank bail–out. The Government investment comes with the condition that the three banks maintain the availability of competitively–priced lending to homeowners and to small businesses. The agreement also includes NatWest, which is owned by RBS. The terms of the bank capitalisation also require Lloyds TSB, HBOS and RBS to restore small business lending to 2007 levels. The Chancellor, Alistair Darling said: “There will need to be a strong focus at these recapitalised banks on making lending available for small business and homebuyers. These conditions are set out in the individual agreements with the banks.” The ... »

Climbing out of the Credit Crunch

Governance Failure in Banks is Key to Credit Crunch

The principal source of the credit crunch is a failure in corporate governance at banks, which encouraged excessive short-term thinking and a blindness to risk, says ACCA (the Association of Chartered Certified Accountants) last week in a report about the year-long financial crisis. ACCA’s policy paper Climbing Out of the Credit Crunch, examines five key areas: corporate governance, remuneration and incentives, risk identification and management, accounting and financial reporting and regulation – and recommends that accepted practices in all these areas need to change to avoid future failures. Richard Aitken-Davies, President of ACCA, said: "The fundamental responsibilities of a corporate board – to provide strategic oversight and direction, to ensure a strong contr... »

Climbing Out of the Credit Crunch

Introduction We are now more than a year into the ‘credit crunch’. An issue which began in one relatively obscure sector of the US housing market has unfolded over the last 12 months into a widespread credit and liquidity crisis which, combined with soaring commodity prices, appears to threaten a global slowdown. While there is general agreement on what has happened, there is far less on why it has occurred and it seems that there is still much to learn about market liquidity. The last few years have seen unprecedented growth in size and profitability of the global banking industry. Worldwide profits1 in 2006 were $788bn — more than $150bn greater than the next most profitable sector, oil, gas and coal. Global banking revenues were 6% of global GDP and profits per employe... »

Credit Crunch = Record absences

Credit Crunch blamed for Record Absences

The economic crisis, the credit crunch, is responsible for record levels of staff sickness as more than 380,000 people call in sick each day, according to a report by absence management company FirstCare. Anxiety about jobs, family finance and the global economy has triggered a nationwide leap in the numbers of people taking time off work, the company claims. Their figures suggest that the number of people phoning in sick with flu–like complaints has almost doubled in recent weeks, while those suffering with gastrointestinal problems have risen by a third. FirstCare’s managing director Aaron Ross said: “The credit crunch is beginning to impact on our health and productivity. We would expect to see seasonal trends of approximately 308 out of every 100,000 employees absent ... »

UK Enterprise Survey Report 2008

Brit Business Unbeaten by Credit Cunch

Despite the last 12 months being a period of economic instability, driven by the credit crunch, increased raw material costs, changes in oil prices and fluctuating consumer demand, UK businesses show they are not willing to give up and instead, continue to fight. According to the latest annual UK Enterprise Survey Report 2008 from the Institute of Chartered Accountants in England and Wales (ICAEW), UK businesses remain ambitious. The survey paints a detailed picture of how UK businesses of all sizes, in all regions and all sectors – as well as their counterparts across the globe – have felt the impact of the more than a year-long credit crunch. It shows that whilst nearly two-thirds (65%) of UK businesses confirm the credit crunch has had a negative effect on their organisation... »

Entrepreneurs start again after Business Failure

Almost nine out of ten British business owners would set up a new venture of their current business failed – in spite of the economic climate. A Barclays Local Business poll of 503 business owners revealed that 87% said they would be keen to start another business should their existing enterprise go under. The poll revealed that the majority would also only wait an average of only four months before getting started with their new venture. Recent research from credit ratings firm Equifax found that the number of UK businesses going bust increased by nearly a third (29%) in July, compared with the same month last year. Barclays Local Business marketing director John Davis said: “The UK’s small business owners are operating in more difficult conditions at the moment and, unf... »

Cost-cutting Small Firms Head Home

An estimated 400,000 small businesses have quit their offices to set up at home since the onset of the credit crunch last November, according to research by telecoms firm O2. The O2 survey of 500 small firms revealed that 13% have not renewed their office lease over the last eight months (equating to 50,000 UK small businesses per month), instead choosing to move their business back home. Of these, 62% cited the need to reduce their costs as their main reason for moving. According to O2 head of SME marketing Simon Devonshire, credit crunch fears and the threat of possible recession were also among the factors that stopped businesses committing to new rental contracts. “Getting rid of the office relieves many small businesses of a major overhead very quickly and shows a rapid response... »

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