New figures report that UK entrepreneurs have to spend at least one day a month on financial admin and 67% of small business owners wouldn’t recommend their bank to others.
The figures released by Tide, ‘a new banking service designed specifically for small business’ – show that 63% of entrepreneurs running startups spend at least one day every month on administrative financial tasks, such as setting up bank accounts, tax calculations, invoices and expenses.
Based on a survey of 149 UK small business owners and sole traders about their experiences of small business banking and of managing their finances, 36% of respondents rated the help and support received from their bank as poor or very poor, while 67% said they weren’t likely to recommend their current business bank to others.
“In the early days of starting a new business, entrepreneurs and sole traders all too easily find themselves tied up in financial red tape. And while the tasks they have to complete aren’t necessarily complicated, they are time-consuming and unfamiliar. There is no reason why banks can’t help their customers to navigate these waters more efficiently and save them time, but they simply aren’t doing so,” said George Bevis, CEO of Tide.
Respondents also revealed their most significant frustrations and challenges in managing their company’s finances. Topping the list was tax calculations (a challenge for 54% of those surveyed), followed by accounting (51%), keeping track of expenses (49%), having to use multiple applications to manage different services (38%), invoicing (30%), and payroll (18%).
Those surveyed were also asked what features were most important in choosing a banking provider. The top Five were easy internet banking (listed by 80%), a good mobile app (66%), free transactions (54%), speed of set up (39%), and the length of the free banking period (36%).
Conversely, some traditional strengths offered by the banking sector such as having a local branch (5%), offering an overdraft (10%) or telephone support (16%) were seen as unimportant, while not a single respondent said that the provision of a chequebook would be a factor in their choice.