Britain’s mid-market companies generate £1.3 trillion in annual turnover while employing 7.3 million people. Despite representing just 0.5% of UK companies, they account for 26% of employment and 30% of economic output. Yet these potential economic drivers face a funding paradox. Recent trade breakthroughs with India and the United States have opened export opportunities, but traditional bank lending constraints threaten to limit how effectively these businesses can capitalize on global market access.
“The UK’s recent trade agreements could shift the country’s international competitiveness,” says Al Christy Jr., founder and CEO of EquitiesFirst. “These deals have the potential to create genuine opportunities for British businesses to expand globally, but success depends on having the right capital structures in place to seize those opportunities.”
Alternative financing solutions may prove essential for companies seeking to bridge the gap between ambitious growth targets and conservative credit markets. Non-financial business borrowing in the UK ranks among the lowest as a percentage of GDP when compared to other G7 economies, creating particularly acute constraints for SMEs.
Trade Deals Create Export Momentum
The UK-India trade deal, concluded on 6 May 2025, is expected to increase bilateral trade by £25.5 billion and unlock new opportunities for businesses across the UK. For the first time, UK businesses will have guaranteed access to India’s vast procurement market, covering approximately 40,000 tenders with a value of at least £38 billion annually. Strategic export financing specialists have recognized the significant opportunities these trade agreements create for UK businesses.
“We’ve already secured the best deal India has ever agreed to, and our US agreement has slashed tariffs for our steel and automotive sectors, protecting hundreds of thousands of British jobs,” said UK Business and Trade Secretary Jonathan Reynolds at a meeting of the Board of Trade following the deal.
Meanwhile, the US-UK trade deal aims to create a $5 billion opportunity for new exports, including more than $700 million in ethanol exports and $250 million in other agricultural products.
Membership applications to Made in Britain increased by 20% following recent trade developments.
“Since the tariffs, more businesses are focused on British manufacturing representation and promotion, so we have seen a real upswing in the number of UK manufacturers reaching out to us to register as members of Made in Britain,” said Made in Britain CEO John Pearce in a company statement following the announcement of the U.S.-UK deal.
Despite these opportunities, financing remains a critical bottleneck. Whole economy investment in the UK was 18.2% of GDP in Quarter 1 2025, the lowest of the G7 nations. Investment advisory services have noted the significant challenges this creates for UK businesses seeking to expand internationally.
Alternative Financing Gains Traction
Market conditions have driven businesses toward diverse solutions to plug funding gaps. Equities-based financing is one potential solution for companies seeking to unlock value from existing equity holdings.
EquitiesFirst’s approach allows businesses to access liquid capital based on their equity portfolios. Global business financing solutions have become increasingly important as traditional lending constraints persist.
“Export-oriented companies often need working capital to fulfill international orders, invest in compliance systems, or establish overseas operations,” Christy Jr. says.
The House of Lords Communications and Digital Committee has argued that The UK faces risks of becoming an “incubator economy” if barriers to scaling up persist, with limited access to capital compared to other countries identified as a key constraint. Alternative financing mechanisms could help address this challenge by providing growth capital that doesn’t rely on traditional credit metrics.
Bank Rate Cuts Support Investment Climate
Encouragingly, the Bank of England cut rates to 4.25% in May 2025, with the MPC voting 5-4 to reduce Bank Rate by 0.25 percentage points. Most economists expect one or two more rate cuts by the end of 2025, potentially taking the base rate to 3.75%. This easing cycle could improve conditions for both traditional and alternative financing.
The rate cut brings relief to borrowers, businesses and consumers. However, the broader impact on business investment depends on companies’ ability to access appropriate financing structures for their growth plans.
The FTSE 100 reached record highs in July 2025, with the highest closing value of 8,975.66 on 10 July 2025. Strong equity markets create favorable conditions for equities-backed lending, as companies can leverage appreciated holdings to fund expansion. Alternative equity-backed financing solutions have positioned themselves to help businesses capitalize on these improved market conditions.
The convergence of new trade opportunities, improving monetary policy conditions, and alternative financing solutions could unlock significant value for UK businesses. Companies that can navigate financing constraints while capitalizing on international market access may find themselves well-positioned to drive the UK’s economic recovery.
