By Mr Bankruptcy
23rd May 2023
With the Bank of England announcing that interest rates are rising again, to 4.5%, businesses must be cautious of the potential impact on them.
Historical interest rates and what they meant
The 0.25% increase in the base rate that was announced by the Bank of England on the 11th May was the 12th consecutive rate rise since December 2021, making the current interest rate the highest it’s been for almost fifteen years.
Interest rates are being raised to control inflation, which currently stand at 10.1%, but the last time that interest rates were at a similar level, the UK was on the brink of a recession that saw the number of business bankruptcies increase significantly.
While the UK continues to avoid recession, there are concerns that increasing interest rates will have a negative impact on many businesses. A report in the Business Leader suggested that when rates rose to 4.25%, 22% of businesses “do not have the tools to deal with another interest rate rise”; we have now entered that territory.
The impact of increasing interest rates
It’s important to understand how changing interest rates affect our finances so that appropriate adjustments can be made:
How to combat rate increases
Businesses need to review costs and budgets and be prepared to adjust their plans accordingly to minimise the impact of increasing interest rates. Where they have serious financial concern, seeking expert help quickly can ensure that they have a plan in place to manage the financial challenges ahead.
James Rosa Associates
James Rosa associates is a firm of debt advisors and debt adjustors. With a supportive and friendly approach, we offer a full range of advice and professional services to business owners/directors as well as individuals who face unmanageable debt and need advice and support, or who are involved in civil or commercial disputes. Our services include:
We are authorised and regulated by the Financial Conduct Authority (FRN665061) to work with clients to produce bespoke solutions to fit their specific circumstances.
Find out if you qualify for a free consultation
If you want to deal with an unmanageable debt, or bring a dispute to a swift and cost-effective resolution, contact James Rosa Associates, ring 0845 6807217 or email email@example.com to find out whether you qualify for a free consultation.
Please be advised that all views expressed in these posts are those of the author and not of James Rosa Associates ltd.