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UK business finance news roundup: boe rate cut, confidence dips and fund-manager consultation

8 May 2025

This week’s headlines in UK business finance reflect a mix of monetary relief, cautious corporate sentiment and fresh regulatory consultations.

Man on steps on Bank of England

Bank rate trimmed amid trade optimism

On 8 May 2025 the Bank of England reduced its base rate by 25 basis points to 4.25%, the fourth cut since last August, in a narrow 5–4 vote. Governor Andrew Bailey pointed to easing inflation pressures and slowing global growth driven by U.S. tariffs, while expressing cautious optimism about a newly struck UK–US trade agreement. The move is already feeding through to cheaper mortgage offers from building societies, though the MPC remains divided on the pace of future cuts. Source: Reuters.

Business confidence dips to three-month low

Despite resilient first-quarter performance, the Lloyds Bank Business Barometer showed UK firms’ confidence falling 10 points in April to 39 percent—the weakest reading since January. Higher employment costs, lingering trade tensions and broader economic uncertainty weighed on sentiment, even as confidence remains above its long-run average of 29 percent. Source: Lloyd.

Treasury and FCA consult on fund-manager regime

On 7 April HM Treasury launched a consultation to streamline the regulatory framework for Alternative Investment Fund Managers (AIFMs), aiming to spur private-capital growth through greater proportionality and simpler reporting. Simultaneously, the Financial Conduct Authority issued a Call for Input on its intended approach to these reforms. Stakeholders have until mid-summer to comment on thresholds, reporting requirements and passporting arrangements.

Keep an eye on these developments—whether you’re reviewing borrowing costs, managing balance-sheet impact, or planning fund-manager engagements, the months ahead promise both opportunities and challenges.

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Please note that the information above is not intended to be financial advice. You should seek independent financial advice before making any decisions about your financial future.

It’s important to remember that all loans and credit agreements come with risks. These risks include non-payment and late-payment of the agreed repayment plan, which could affect your business credit score and impact your ability to find future funding. Always read the terms and conditions of every loan or credit agreement before you proceed. Contact us for support if you ever face difficulties making your repayments.

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Joe Morley
Joe Morley

Head of Unsecured Lending

Joe has worked in the alternative lending space since 2015. During this time he has helped hundreds of SMEs access millions in essential funding ranging from long-term asset-backed lending to short-term unsecured revolving credit lines and beyond. In his role, Joe manages and supports a large team of Credit Finance specialists.

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Funding Options helps UK firms access business finance, working directly with businesses and their trusted advisors. We are a credit broker and do not provide loans ourselves. All finance and quotes are subject to status and income. Applicants must be aged 18 and over and terms and conditions apply. Guarantees and Indemnities may be required. Funding Options can introduce applicants to a number of providers based on the applicants' circumstances and creditworthiness. We are also able to make insurance introductions. Funding Options will receive a commission or finder’s fee for effecting such finance and insurance introductions.

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