The Institute of Credit Management (ICM) has launched a petition with Graydon UK, the commercial credit referencing agency, to prompt a Government rethink on plans to exempt micro-businesses from having to file accounts at Companies House – plans it believes will seriously hamper the economic recovery rather than encourage it.
The move follows the publication of figures from a recent survey of its 8000 Members that posed the simple question: if accounts for a potential customer wanting to place a relatively small order with you were not available at Companies House or via a Credit Reference agency, what would you do?
Nearly 37 percent said that they would not approve the order for immediate supply, reject the account and insist on cash in advance; 15 percent said they would accept the increased risk and trade anyway; and more than 48 percent said that they would ask the customer to provide financial data to support their application.
The findings support the ICM’s view that exempting micro business from filing accounts is wholly the wrong way of tackling what is a comparatively simple issue: businesses should be prepared to provide more information not less: “Without audited numbers that can be trusted, banks will not lend and suppliers will not extend credit to their customers,” says Chief Executive Philip King. “Growth will be restricted, not encouraged.”
The ICM’s survey follows similar research in June from Graydon UK that showed that 91 per cent of credit and finance professionals believe that the proposals will make it harder for small businesses to access trade credit, and that 87 per cent of respondents did not believe that the Government’s plans will help drive business growth.
'CreditMan' supports the ICM and Graydon UK and we urge you to support the petition, by going to: http://www.surveymonkey.com/s/8KGN5BH
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