Majority of UK Black Startup Owners Say They Don’t Trust Banks To Support Their Business
Less than half of Britain’s Black business owners – 43 percent – trust banks to support their interests, a new survey has revealed.
The report, entitled ‘Black British In Business and Proud’, highlights the issue of structural racism in terms of accessing capital, and its impact on Black business owners.
The research, which was sponsored by Lloyds Bank and undertaken by Savanta, surveyed 808 participants from Black communities in Britain – 345 of whom were Black business owners.
It revealed that Black business owners are 21% more likely to be self-financed than to use financing from banks. This can mean losing access not just to additional financial support, but also mentoring programs and business networks.
Among other findings from the report was poor sentiment amongst Black business owners towards the UK government, with just over a quarter (27%) trusting the national government to have their best interests in mind.
One reason for this disparity in trust could be due to previous experience.
Some 79% of Black business owners said they wanted sources of support to understand their culture and lived experience – and more than half (53%) said they have experienced negative societal discrimination.
Despite the research, the ‘Black pound’ holds significant value within the British economy. Data from The Centre for Research of Ethnic and Minority Entrepreneurship found that firms owned by people of African and Caribbean origin contribute £25 billion annually.
Shari Leigh, Founder of Black Business Network and member of the Black Business Advisory Committee told Startups: “For the Black business community these findings are nothing new. The legacy of ties to the slave industry and unaddressed structural racism remain at the forefront of conversations within the Black British community.
“It’s commonplace to balance the idea of want versus need when engaging with traditional financial institutions, questioning the importance of our feelings and visibility. It just shouldn’t be this way.
“We use, work for and contribute to these institutions and we should be seen and heard. This research is important because it quantifies Black business communities’ unapologetic thoughts and experiences and outlines tangible steps that Lloyds Bank and other institutions can take to address this lack of trust in real, tangible ways.”
The study came months after Reuters reported that eight of the top 14 UK banks failed to publish ethnic diversity data outlining the number of Black senior leaders in their companies. Only three – Lloyds Banking Group, HSBC, and UBS – provided full breakdowns.