A report published by the British Business Bank has revealed that a third of small businesses believe it will become 'more difficult' to access finance once the UK leaves the EU.
The Bank's 2019 Small Business Finance Markets report also revealed that, although 29% of small firms expect Brexit to have a 'negative impact' on their business, many remain optimistic about growth, with half of small businesses still aspiring to expand over the next 12 months.
However, the overall demand for external finance has declined, according to the report: just 36% of small businesses used external finance in 2018. Evidence also suggests that some firms are delaying longer-term investment decisions until after Brexit.
Commenting on the report, Keith Morgan, CEO of the British Business Bank, said: 'It is clear that a lack of confidence is affecting many smaller businesses, as evidenced by a continuing drop in demand for external finance. It is, however, encouraging to see that half still aspire to grow, and that there's increased awareness of a broader range of finance options.
'This will be an important factor in ensuring that smaller businesses are better placed to make the right finance choices as uncertainty diminishes and confidence returns.'