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Majority of lenders are positive about future of the commercial mortgage market

Some 77% of lenders believe the number of loans they broker will increase, showing a positive outlook for the future of intermediaries, according to Spotcap.

The business lender surveyed 132 commercial finance intermediaries over the course of July to determine the challenges and opportunities in the market.

Its research found that:

  • One in four respondents consider Brexit a key challenge, while one fifth believe that it will bring new business opportunities.
  • Some 77% of respondents are optimistic about their loans increasing, while more than half of these believe it will rise by a lot.
  • Property, professional services, construction and manufacturing are perceived as the key industries for business growth.
  • The number of documents required to process an application is viewed as a barrier, followed by generating new business and understanding the offering of different lenders.

The results were published as part of a report titled: ‘The State of Commercial Finance in the UK’.

Recent statistics from UK Finance revealed that UK lenders approved over 290,000 loans and overdrafts to small and medium-sized businesses (SMEs) in 2018, worth £28 billion in total.

However, despite the healthy size of the SME loan market in the UK there is still a £22 billion funding gap, according to the Bank of England.

What’s more, recent data from the British Business Bank stated that businesses receiving external support when looking for funding are 25% more likely to become high-growth companies.

“Commercial finance intermediaries are an important part of the SME funding jigsaw,” says Niels Turfboer, managing director at Spotcap.

“The more adaptable and open-minded to change intermediaries and lenders are, the better and faster they can compete and grow their business.”

Graham Toy, chief executive officer of the National Association of Commercial Finance Brokers, adds: “The research chimes with our own view of the commercial finance broker’s role in supporting and advising business borrowers.”

“Brokers have a positive outlook partly because they remain instinctively agile, with many of them having weathered the unpredictability of a post-2008 world.”

To view the full report, click here.


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