Why many NI firms struggle to access finance

Whether you need funding to invest in new equipment, upgrade premises, manage cash flow, or fuel expansion, many business owners are unsure where to start, or worse, believe funding simply isn’t available to them.

Almost 50% of SMEs aren’t confident about securing finance if they need it while 60% claim they are unaware of the finance options available to them, and a staggering 80% have no awareness of alternative finance options outside traditional bank loans.

The reality is funding options do exist, but businesses often miss out due to limited awareness, outdated financial information, or approaching finance reactively when they’re already under pressure.

Here are the top reasons SMEs struggle to secure finance.

1. Relying on Outdated Ideas About Finance

Many business owners still think a bank loan is the only option. Historically, your local bank manager would have been your first port of call, especially for long-standing customers. But with bank branch closures and centralised decision-making, that traditional relationship no longer exists for most SMEs.

As a result, when businesses are declined by their bank, whether for lack of collateral, short trading history, or cash flow concerns, they often assume that’s the end of the road.

The truth: There is now a wider range of lenders and finance products than ever before. From asset finance to invoice discounting, merchant cash advances to peer-to-peer lending, there are solutions designed for almost every business need, if you know where to look.

2. Lack of Financial Awareness Within the Business

Even businesses with strong turnover and a healthy order book can struggle to secure finance if they can’t clearly demonstrate their financial health to lenders.

This is especially true for smaller businesses without a dedicated finance team, where accounts are only updated once a year for tax purposes.

In these cases, outdated financial data makes it difficult for lenders to assess your current trading position, or understand how the new finance will benefit your business.

The truth: Many lenders, particularly those offering competitive rates, want to see up-to-date management accounts, usually within the last three months. If you don’t regularly produce these reports, you’re already limiting your options.

3. A Reactive, Last-Minute Approach to Finance

Too many businesses only think about finance when they’re already in a crisis - whether it’s a sudden equipment breakdown, a late payment from a customer, or a large unexpected tax bill.

When businesses apply for finance in urgent, high-pressure situations, they’re often forced to accept higher-cost borrowing from lenders who specialise in quick-turnaround funding rather than accessing better-value finance through proper planning.

The truth: Businesses that take a proactive approach, regularly reviewing their financial health and planning ahead for potential funding needs, are far more likely to access cheaper, more flexible finance, even when challenges arise.

How to Improve Your Chances of Securing Finance

1. Define Your Funding Goals

The first step is to be clear about why you need finance and what you want to achieve with it.

• Are you investing in new equipment to improve efficiency?
• Do you need working capital to manage cash flow during a slow period?
• Are you expanding into new premises or launching a new product line?

Your funding goal will directly impact which type of finance is the best fit and how lenders assess your application. Clear objectives also make it easier to build a convincing business case for lenders.

When working with clients at Johnston Financial Solutions, I always ask our clients this key question upfront: “What are you trying to achieve?” The clearer your goals, the easier it is to match you with the right finance solution.

2. Get Your Financial Information in Order

Lenders want to see a clear picture of your financial health, not just last year’s tax accounts, but real-time data showing your current performance.

To maximise your options, you should be able to provide:

• Your last three years’ certified accounts.
• Up-to-date management accounts (Profit & Loss, Balance Sheet, Cash Flow Forecast).
• Three to twelve months of recent bank statements.

This level of transparency not only helps lenders assess your business, but also gives you, the business owner, better visibility over your own finances.

With cloud accounting systems and the help of a good bookkeeper, there’s no reason even the smallest businesses can’t keep their figures current.

3. Understand the Full Range of Finance Options

Beyond traditional loans, today’s finance landscape offers:

• Asset Finance – Funding for vehicles, machinery, or equipment.
• Invoice Finance – Unlocking cash tied up in unpaid invoices.
• Commercial Mortgages – For purchasing or refinancing business premises.
• Unsecured Business Loans – For working capital or business investment.
• Merchant Cash Advances – Quick cash against future card sales.

Because we are independent brokers, at Johnston Financial Solutions we can work with mainstream banks, challenger banks, peer-to-peer lenders, and specialist funders, giving our clients access to the full spectrum of finance options, all matched to their specific needs.

4. Work with a Trusted Finance Broker

Navigating the growing range of finance options is time-consuming, especially when you’re already running a business. A good broker does more than find you a loan, we will help you:

• Identify the right type of finance for your goals.
• Prepare a strong, credible finance application.
• Negotiate better terms.
• Build a long-term finance strategy to support future growth.

Our clients see us as a financial partner, not just a broker. They know they can pick up the phone anytime to discuss their plans, not just when they urgently need funding.

The reality is finance is out there, even for businesses that have been declined by their bank. But the key to securing the right finance, at the right price, is preparation.

• Understand your options.
• Keep your financial information current.
• Plan ahead, don’t wait for a crisis.
• Work with an experienced broker who knows the market.

With over three decades of experience, through Johnston Financial Solutions I can help businesses across Northern Ireland secure finance tailored to their needs, from investment-ready growth funding to flexible short-term solutions. For more information call 07803 312 874.