The North West’s small business community has remained resilient, with external finance usage growing across 2024.
This is according to the British Business Bank’s fifth Nation and Regions Tracker, published today, which found that 51% of the regions small businesses used external finance last year, a five percentage point increase, the highest increase across the UK.
Equity markets performed particularly well across the North West in 2024, with deal volumes rising by 11.5% to 146, while equivalent values increased by an impressive 46.2% to £654m. This surge comes despite a nationwide slowdown in equity deals, with UK-wide deal volumes falling by 15.1%.
Demand for external finance among North West small businesses shows no signs of slowing down. An estimated 34% of smaller businesses in the region are open to using finance for growth, while only 9% see it as a major obstacle, a two percentage point drop on the previous year.
Research and development (R&D) remains a key focus for small businesses in the North West, with 44% having invested in R&D in 2024. 31% of businesses were also undertaking new-to-market innovations, ensuring the region remains a hub for innovation.
Throughout the last year, the British Business Bank has continued to support many of these businesses to start-up, scale and grow, with 84% of the businesses supported being outside London.
In its latest financial year across the North West, the Bank supported 2,900 companies with £700m in funding. This support is expected to generate £1.6bn in additional turnover over the lifetime of the finance while supporting 32,100 existing jobs and creating an estimated 3,000 additional jobs.
Vicky Mears, UK Network Director, North of England and Midlands at the British Business Bank, said: “Small businesses are crucial to the UK economy, with today’s findings across the North West showing just how resilient our smaller business ecosystem is. It’s particularly encouraging to see such an uptick in equity deals across our region, proving the North West remains a hub of innovation, with a host of world-leading universities and research institutions bringing new technologies and services to market.
“There is clearly still demand from smaller businesses for finance to scale and grow despite mounting economic uncertainty, so it’s important they have access to bespoke, targeted funding. As a Bank, we’re continuing to ensure we serve the entirety of the UK, particularly those areas that have been left behind in the past. With our Start Up Loans programme, Northern Powerhouse Investment Fund II (NPIF II), and incoming clusters across the North, we’re ensuring we’re there for businesses of all sizes.”
