NORTHERN Ireland SMEs have the highest level of debt out of all UK regions, new research has revealed.
With a debt of £98,192 per business, the north is the most indebted region, according to UK company formation experts, Turnerlittle.com. SMEs in Northern Ireland were found to have the highest debt level in the UK – owing almost three times the national average (£33,840) and more than four times borrowed by those in east England (£22,472) which is the least indebted region per business.
After Northern Ireland, the highest debt levels per business were observed in the south west of England (£44,838), Scotland (£41,975) and Wales (£41,972).
In all seven out of 12 regions exceeded the average national debt per business.
Turnerlittle.com also looked at data from UK Finance on business lending by cities and towns. With a staggering debt of £357,770 per business, Exeter was found to be the most indebted city per business in the UK, followed by Gloucester (£296,110), Ipswich (£233,171) and Norwich (£229,074). The lowest level of debt per business was observed in Sutton (£18,825), followed by Wigan (£21,812), Sunderland (£24,576) and Luton (£27,391).
Turnerlittle.com investigated the levels of SME borrowing, analysing the latest data from UK Finance to assess how the UK’s debt crisis has affected businesses. The data revealed that unlike consumer borrowing, SME borrowing in 2017 remained stable. But when the amount borrowed was compared with the number of active businesses from the ONS dataset on Business demography, significant regional differences were observed.
Managing director of Turnerlittle.com, James Turner the level of business debt is a concern.
“Even though we didn’t find any direct correlation between the level of business debt and economic productivity, abnormal deviation from the national average in either direction probably isn’t a good sign. While excessive borrowing often goes hand in hand with financial hardships, extremely low debt levels may indicate that businesses are perhaps not investing enough in innovation, research and development. Either way, it’s bad news for the economy.”
Source: Irish News