While many people will be winding down for the festive season, Christmas sharpens the focus on SME finance and how the sector is going to deliver the growth that will underpin a more prosperous 2016.

According to new data from the Centre for Economics and Business Research and American Express, the Christmas period is worth almost £14 billion to SMEs in the UK. This annual uplift is vital not only to the profit margins of small businesses across the country but also to the wider economy. Research from the Guild of Travel Management Companies shows that SME growth is critical to supporting the UK economy: in 2014, small businesses reported turnover of £1.6 trillion, compared with £2 trillion by larger firms.

These figures underline the importance of the SME sector and their ability to perform well at this time of year and use the profits as a platform for business development in 2016. Central to this capability is small business finance and access to funding, and in 2015 alternative finance has played a major role in maintaining cashflow and funding growth. Furthermore, it is clear that services such as invoice finance, peer-to-peer lending and crowdfunding are pivotal to SME sector growth in 2016.

In 2015, alternative finance has established a central position in the SME finance sector, moving notably from the periphery of the marketplace, and its status is only set to grow as the focus grows on raising awareness of the services on offer. Indeed, with traditional lenders still displaying caution, the important of alternative finance to SME growth will only increase in 2016.

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