Retailers tighten the purse strings after Brexit vote

Paper money people

Small and medium sized enterprises (SMEs) within the retail sector are the third most active savers in the UK, according to new data out today.

The research, conducted by the Hampshire Trust Bank, found that small to medium sized retailers hold an average 68% of their total funds in savings accounts.

Charities and architects, which hold 77% and 69% of total funds in business savings respectively, are the most active savers.

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Following the outcome of the EU Referendum, a quarter of businesses within the retail sector said they were increasing the amount of cash in their firms to build a cash buffer, but this figure is lower than the national average of 38%.

Just over one in 10 retail SMEs (12%) said they were increasing cash reserves due to concerns about the UK economic outlook – consistent with the national average (12%).

The news comes less than two years after research by retail bank Aldermore found that less than a third of retail SMEs have a business savings account.

Stuart Hulme, director of Savings at Hampshire Trust Bank, said: “Our study demonstrates the sector differences when it comes to the amounts businesses and organisations are holding in current and savings accounts.

“The organisations that have been stockpiling cash into current accounts should consider the opportunities to make more out of every £1 earnt. At Hampshire Trust Bank, we continue to identify ways to meet the savings needs of SMEs – the engine room of the UK economy. The benefit of making use of savings accounts is not only the interest rate return you get as a business, but also the knowledge that the money is being lent on to SMEs looking to grow, delivering double value and supporting investment in the UK.”


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