The capital that greases the wheels ofcommerce in the channel has become harder to access and its absence isundermining the ability for some companies to operate.
According to figures from BDO Stoy Hayward companies in thetechnology and telco sector have seen a halving in the amount of funding theycan call on and 60% revealed it was hard to get hold of new funding.
As a result just over half of those questioned revealed theyhad scaled back plans to raise capital this year.
Julian Frost, head of technology, media and telecoms at BDOStoy Hayward, said that it was concerned that companies were not getting thefunds they required to grow their businesses and there were “increasing levelsof frustration” being sounded by firms.
“As the economic environment remains tough over the comingmonths, the situation is likely to become increasingly difficult and manybusinesses may feel that funding has dried up completely,” he said.
“Businesses have found themselves in an ironic situation asthe banks, particularly those who have been nationalised, are being encouraged(if not pressurised) to lend. However there is a perception amongst businessesthat obtaining bank funding has become a very protracted and expensive process,”he added.