In the first three quarters of 2023, the value of equity finance in Northern Ireland surged by 39% to £58 million. However, a British Business Bank analysis showed a 27% decrease in the number of transactions, dropping to 16.
According to the bank’s Small Business Finance Markets 2023/24 report, smaller enterprises in Northern Ireland are more inclined to choose traditional financing options, such as bank loans. In the second quarter (Q2) of 2023, 20% of businesses in Northern Ireland opted for bank loans, in contrast to the 12% of small businesses across the UK.
The report also highlighted a significant increase in credit card usage within Northern Ireland, jumping by 13 percentage points from Q1 to Q2 2023. This rise was considerably above the UK’s overall increase of 4 percentage points.
Across the UK, the adoption of external finance by smaller businesses continued to rise throughout the year, increasing from 41% in Q1 to 50% in Q3.
In 2023, 58% of small businesses cited working capital as their primary reason for seeking finance, a rise from 53% in the previous year.
Asset finance also experienced growth for the third consecutive year, rising by 7% in 2023 to a record £23.5 billion.
Susan Nightingale, the British Business Bank’s Director for Devolved Nations, commented, “The British Business Bank has been on a journey in Northern Ireland for the past decade and during that time we have witnessed a lot of positive changes. Supporting businesses in accessing finance has been key.
“There is now more choice than ever in Northern Ireland for helping your business to start-up and scale up.
“A great example of this is the £70m Investment Fund for Northern Ireland which will provide both debt and equity finance and help support smaller businesses at different stages of their growth.”
