1) Advisers and brokers will become ever more indispensable.

Professional advice is going to play a key role in supporting SMEs over the next 12 months. Financial products are becoming more complex as central policymakers introduce government support and grant schemes in response to the pandemic.

2) SME-lender relationships will drive the speed of the recovery.

SMEs are going to be the green shoots of the UK’s emergence from this pandemic, and how quickly we bounce back will depend on their access to capital. However, in times of turbulence, the reaction of lenders is often to tighten their appetite for lending and demand more financial information from SMEs looking to borrow.

3) Businesses will be forced to look beyond their existing finance providers.

This economic downturn is likely to result in several of the traditional providers curbing their lending in some sectors to mitigate concentration concerns. Many SMEs may find their existing provider is simply unable – or unwilling – to lend any more, even if they are a perfectly creditworthy business.

4) Brexit will lead to a rise in demand for finance from SMEs as production is potentially re-shored to the UK.

With Brexit legislation now passed, large and mid-sized corporates are likely to look again at their supply chains for opportunities to re-shore production in order to reduce risk and drive-up efficiency. Where this proves to be desirable, there is going to be significant demand for investment to fund the manufacturing and logistics assets.

5) Green finance will move from growth industry to the mainstream.

Proactive regulation to encourage the take-up of sustainable transport has spurred SMEs’ uptake of green vehicle fleets faster than many would have imagined. I predict plenty more businesses will look to take advantage of the attractive incentives these solutions come with in 2021. Brokers and advisers that keep a comprehensive handle on new developments will be in high demand in 2021.

Richard Cameron is the head of asset finance for Allica Bank