A call for digital adoption incentives for small businesses has underlined the importance of digital tech and the digital marketplace for 2021 and beyond. The use of digital tech is vital for smaller firms, not least as a growth aid. But how can they afford it?

According to a recent report by the Coalition for a Digital Economy, more needs to be done to help the small business sector increase its use of digital technology. It is lobbying the government to offer a range of support measures, including tax credits for the adoption of new technology, the creation of an approved list of products and services, and certified help with what tech to adopt and how.

The advocate group claims that if more isn’t done to make digital adoption easier, in particular for smaller firms, UK businesses will fall further behind their European peers, weakening the sector’s position in the post-Covid-19 and post-Brexit marketplace.

Why the right post-Covid-19 digital tech strategy is vital

The greater use of digital technology and the growth of digital market tools has been a key theme of small business development in 2020. The impact of Covid-19 on markets and operating practices has put a renewed focus on digital markets and the use of digital tech to increase efficiency and boost sales.

For some small businesses, this development takes the form of expanding websites to include greater digital functionality and refocusing marketing efforts on digital communication. For others, it means investing in digital tech to streamline and optimise workplaces and work processes. The focus on margins has never been so sharp.

The need for digital-led investment and growth is clear, but for under-pressure small businesses, their ability to take these steps is restricted by the price tag attached. This is why is it vital that business owners are aware of all the funding options available to them, from the government’s emergency support schemes to the services of alternative lenders.

Surviving into 2021 and how alternative lenders can help

With regard to alternative finance, in the wake of prolonged caution from traditional lenders and at a time of extraordinary economic contraction, facilities such as invoice finance, asset finance, peer-to-peer lending and crowdfunding are proving a vital source of capital for small businesses, both for safeguarding cashflow and for essential investment. These facilities, which offer a more personalised approach to lending, are helping small businesses survive and grow.

Tellingly, alternative finance is playing a key role in the government’s Covid-19 business support strategy, in particular with regard to the Coronavirus Business Interruption Loan Scheme, which offers access to a range of finance facilities, including alternative finance services.

What smaller firms need to know about finance options

As we look forward to 2021, the importance of digitalisation is clear. The right post-Covid-19 digital strategy will be vital. The challenge for SMEs is affording it and this is why knowledge of all finance options, including alternative lending services, is crucial.

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