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Finance for evolving British businesses


One of the fortes of Britain’s businesses is that they are constantly innovating and evolving.

That is part of the reason why, here at Paragon, we have recently expanded our lending scope to include financing of ‘soft’ assets to add to the ‘hard’ assets we traditionally funded.

While hard assets are typically plant and machinery and vehicles, soft assets involve a much more varied list of business equipment. This could range from IT hardware or software, to emerging technologies that High Street lenders are reluctant to consider.

Our move reflects the evolving world of British businesses for the Millennial generation and beyond and it will allow us to get more funding to the SMEs that need it.

You only have to look at the statistics to see clearly how the business landscape has changed across the UK in the past half century with millennials seeing a shift away from industries that were more pronounced during the times of their grandparents and even parents.

Latest figures for the UK show that 75% of all businesses in the UK, which currently stands at 4.2 million, are in the services industries, according to the House of Commons Library for December 2018. When we say services industries, although that includes retail, most of these fall under the Professional, Scientific and Technical sector.

In comparison, the Construction sector now accounts for 17% of all businesses while Manufacturing firms accounts for 5%.

While we still do a lot of work with construction and manufacturing firms, there has been a notable rise of the service sector, which has really surged in recent decades and now dominates the UK economy, contributing around 80% of GDP.

But if you take a look back in time to the 1970’s, this was a very different story. A Historic data on Industries in the UK briefing paper, produced in 2016 by the House of Commons Library, revealed how things have changed.

As a % of total economic output in the UK:

  • The manufacturing industry accounted for 32% in 1970 and 11% in 2010.
  • The service industry accounted for 55% in 1970 and 77% in 2010.
  • The business services and finance industry (part of the services industry) accounted for 16% in 1970 and 33% in 2010.

% of total economic output, GVA, SIC2003 % of total economic output, GVA, SIC2003

* Graphs from the Historic data on industries in the UK briefing paper. Number 06623, 15 August 2016. House of Commons Library.

What’s reassuring is that however sectors have or are changing, Britain has a strong business heritage with people never shy to develop and build on new ideas, whatever the industry.

So, as we expand into financing soft assets, we underline our desire to support even more of the SMEs and entrepreneurs that will shape the future of our economy.

Please note, this is an unregulated product

Paragon Bank PLC is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Registered in England number 05390593. Registered office 51 Homer Road, Solihull, West Midlands B91 3QJ. Paragon Bank PLC is registered on the Financial Services Register under the firm reference number 604551