More than half (51%) of UK SMEs said they have used or considered using alternative finance, according to a study conducted by Amicus Finance in the first quarter of 2016. The figure was 9% higher than the survey recorded in the same period in 2015.

The most popular option, considered by 47% of the 400 respondents, was crowdsourcing finance, including peer-to-peer lending and crowdfunding. This was followed by cashflow/invoice finance (32%), property finance such as bridging loans and commercial mortgages (29%) and asset finance (24%).

The survey found that small firms predict demand for alternative finance will increase by an average of 28% over the next two years, with 53% of small business owners anticipating the growth.

On a regional basis, more than two thirds (69%) of small business owners in the North West predicted a rise in demand for alternative finance over the next two years, the largest portion in the UK. Business owners in the East Midlands and West Midlands were second and third with 67% and 62% respectively. Just over half (52%) of small business owners in London predicted a rise in demand for alternative finance. SME owners in the North East were the least enthusiastic about alternative finance with 29% anticipating an increase.

The research also revealed the specific areas that SME owners are targeting for investment over the next 12 months. Two in five (39%) SME owners will look to invest in IT equipment, and nearly one five (18%) in cars, spending on average £14,496 and £5,290 respectively. 13% of SME owners said they would invest in telecoms equipment (£5,368) and 12% in plant and machinery (£7,426). One in ten (11%) plan to buy commercial vehicles, spending on average £11,163.

John Jenkins, chief executive officer of Amicus, said: "This research shows that the business finance landscape continues to change. Demand for alternative finance is set to go from strength to strength over the coming years as mainstream lenders struggle to evolve to adequately support a thriving small business community.

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"Small businesses are increasingly turning to specialist lenders who have the skills to understand their specific needs. Having built a strong business base from our property lending expertise we have significantly broadened our proposition into other areas of specialist lending. Our relationship-based approach resonates well in specialist lending markets that are poorly served by mainstream lenders."