SME Business News

Nearly two thirds of UK small firms bear a credit rating which may negatively affect their ability to obtain credit finance and favourable credit terms from suppliers, according to new research from Graydon UK, a leading credit risk management agency.

Using Graydon UKs credit scoring rules, their June 2009 study reveals that 60 per cent of the three million SME businesses analysed were assessed by the agency as being High Risk or Above Normal Risk, in terms of defaulting on trade payments or getting into financial difficulties. Just 13 per cent of the companies reviewed were awarded Low Risk ratings by Graydon UK.

Martin Williams says: “While the recession has unquestionably had an adverse impact on the creditworthiness of small firms in the UK, just as much damage has been inflicted by the sheer absence of relevant information on their financial performance. This lack of data is known to damage companies credit scores, just as it does with personal credit scoring.”