Interest rate increase could crush almost 80,000 businesses, a Yorkshire-based insolvency expert has warned.
Paul Moorhead, of insolvency business turnaround and recovery practice Graywoods, has claimed that even the smallest interest rate rise could prove disastrous for many firms.
Sheffield-based Mr Moorhead said that the latest industry figures point to a bleak future for companies struggling to maintain a hold on their finances.
“The financial turmoil we have seen in recent years means interest rates have fallen to historic lows,” Mr Moorhead said.
“That might seem like a good thing, but many businesses are now concerned that there might be a shift in the opposite direction at last. Such a move may sound unlikely, but in uncertain times, it is always a possibility and many businesses have no confidence in being able to protect themselves.”
He said business owners should make detailed plans for interest rate rises.
“A lot of businesses need to invest in order to remain competitive, and others may need to borrow. If that is the case they need to make sure they are borrowing money on terms they can afford and that can be sustained in the long term,” he said.
He pointed out that an estimated 25,000 businesses had admitted they were already struggling to cope with trading conditions.
“Even those companies, though, can do things to navigate themselves through troubled waters,” he said.