Overseas expansion is a natural step for many businesses, in particular as markets are becoming increasingly globalised, but a new study shows that a lack of finance is holding back SMEs. Alternative finance can help these firms raise the capital for investment in this type of growth.

According to a new research from DocuSign, less than a quarter of SMEs in the UK are planning international expansion. One the primary reasons for the widespread reluctance identified by the survey is a lack of finance. Other principal barriers to grow are a lack of experience and red tape.

Furthermore, downbeat market conditions, which can be linked to the uncertainty surrounding Brexit, must also be a factor. Data from the UK Department for Business, Energy and Industrial Strategy show that over 1 million businesses in the UK view Brexit as a major obstacle to success.

At the same time, business confidence is at a record low level according to the Federation of Small Businesses. The organisation’s latest Small Business Index was negative for the third quarter in succession – this is the first time it has recorded such a decline since it was launched nine years ago.

So, how can SMEs that want to expand internationally overcome the obstacles that are stopping them doing so? When it comes to funding, alternative finance can help.

In the wake of prolonged caution from traditional lenders, services such as invoice finance, asset finance, peer-to-peer lending and crowdfunding are providing SME owners with an alternative means of accessing capital for essential investment, such as in new market growth.

This is how a Sussex small business used peer-to-peer lending, through a commercial finance broker that specialises in alternative finance, to raise the capital to invest in expansion.

Indeed, with easier and more affordable access to more flexible finance facilities, SME owners would be better positioned to focus on the training and recruitment that would help them gain the critical experience that they need to target overseas expansion and wade through the red tape that is part of the process.

SMEs are an essential growth engine for the UK economy and these businesses should be able to explore all growth revenues available to them, including overseas expansion. If they are to have this freedom, access to finance is critical. As such, business owners need to be aware of all the funding options available to them, including alternative finance.

To find out more about A&T Business Associates services, contact Steve Bowles on 01903 602211 or steve.bowles@atbusinessassociates.co.uk.