The study found that more than a quarter of these firms (27%) were rejected outright when making a funding request.

Over two-fifths of sole traders (43%) have had funding requests rejected, while 44% of businesses with 10-49 employees experienced the same outcome.

David Luck, CEO and founder of Capital on Tap (pictured above), said: “It’s clear that banks are denying small businesses the chance to fulfil their growth opportunities. 

“Typically, smaller businesses have limited access to credit, so the importance of having a facility that can provide a quick cash injection to invest in equipment or make the most of a busy trading period is essential to stability and future growth.”

David said that what it saw from the study was that businesses were generally looking for small, flexible credit facilities, whether at times of need or opportunity. 

“This is exactly where banks struggle to service the millions of SMEs in the UK, as they are geared for consumers or large corporate clients. 

“The next generation of entrepreneurs expect the flexibility and quick service from banks that they can attain in their personal lives, which includes easy access to funding. 

“We are seeing the success of alternative lenders in the UK because there is a clear demand for this type of fast, transparent service.”