Spring ambition: we all have a role to play in economic growth

We’re over halfway through the first quarter of 2025 as we hurtle towards spring. Many of us in Western Europe will be hoping for a respite from the cold weather, in what feels like a long winter, with a few weeks still remaining.

While news this month that the UK economy grew fractionally in the fourth quarter of 2024 is welcome, the shadow of National Insurance increases looms large for small and medium sized businesses owners across the country. This is amid inflationary pressure and a higher – though falling?- interest rate environment.

It’s easy - and customary here in the UK - to talk of challenges. But small and medium sized businesses, by their very nature, are resilient and resourceful. Our latest SME Confidence Tracker attests to this.

While the high cost of doing business remains a concern, business owners are undoubtedly focused on the opportunities ahead. Two-thirds expect sales growth over the coming months, and – while down on Autumn 2024 figures – 87 percent say they’re planning to invest in 2025.

It’s this ambition we must concentrate on and find ways to nurture, whether for established businesses seeking partners to support their growth, or by taking a chance on the entrepreneurs of the future who are spearheading innovation and change.

This is what many of our customers are expressing. They want to pivot for growth; expand into new markets, invest in technology that improves how they operate or sell. They want to forge new partnerships in domestic and international markets.

The financial services sector has a key role to play in this, ensuring that access to finance reflects the aspirations of all segments of the SME market.

But it's not only through the provision of finance that we can support. The road to success for any business is via the relentless customer centricity and dependability of its partners.

Whether this is a healthy risk appetite, relationship-based service or the products and services available, for those of us within the ecosystems of SMEs seeking growth, we must ask ourselves: how else can we contribute? We must reflect back the tenancy and ambition of businesses on the front foot towards growth.

Last month, UK Chancellor, Rt Hon Rachel Reeves , spoke of three strategic pillars to kick-start growth; stability in politics, public finances and the economy; reform to make it easier for businesses to trade and raise finance; and investment.

While the first two pillars remain open to opinion, what is clear is that, despite stagnant economic climates in many markets around the world, there is appetite to invest and grow among many small businesses. This intention must be equalled by the right conditions: stability over volatility, improving infrastructure, and partnership over competition.

These fundamental building blocks formed the basis of any period of economic prosperity, from the first industrial revolution and the post-WWII boom, to the recent GDP-booms of the 1990s and early 2000s.

Though we must, of course, remain alert to geopolitical developments and support SMEs struggling today, we must also strive to find ways to support those ambitious businesses focused on growth – not simply for ourselves, or those specific customers, but for long-term economic prosperity.