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Atradius comments on BoE interest rates

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Businesses face rising pressures following the Bank of England’s Monetary Policy Committee’s announcement to hold interest rates at 3.75%.

“Stagnant interest rates aren’t good news – it just prolongs the squeeze,” says James Burgess, Head of Commercial and insolvency expert, Atradius UK.   “As we approach the new financial year businesses are facing a crunch of policy-driven tax increases, higher employment costs, and changes to business rates.  Our data shows that claims for failed or late invoice payments are up 22% since December, which is often an early warning sign of trouble ahead.”

According to the latest Atradius Resilience Gap Report business risks have cost UK SMEs 76% of their emergency cash pots in the past year alone, with a one in five (22%) businesses reporting that these risks put their survival in jeopardy with a further 49% saying they are experiencing reduced profitability.

“Businesses that actively protect liquidity, strengthen supply chains and safeguard their receivables will be far better placed to weather the shocks still working through the economy,” continues Burgess.  “We urge all businesses to understand their business resilience score so they can be better prepared to weather expected and – as is seemingly more common in the current climate – unexpected financial shocks.”



 
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