By Daniel Hunter

The majority of small and medium-sized enterprise (SME) owners and directors in the UK want to see an SME hub created to boost the economy, according to research from Axa.

An overwhelming majority of 89% said an SME hub would be "beneficial" to the UK economy and 71% said concentration on London is "a risk to the economy".

The report, Driving local business growth: Creating an ‘SME hub’, indicates that the demand for a non-London-based hub would be very high and, crucially, would help promote a more balanced lending environment. Sixty per cent believe their geographical location impacts their ability to borrow at competitive levels from banks, with a quarter of respondents (25%) averring that it has a “significant” impact.

More than nine in ten (93%) said that there would be a demand from SME businesses for an hub outside of London to create an environment for growth for small businesses; more than a third (36%) regard the demand for a hub of this type as “strong”.

Subsidised business rates and free legal and financial advice were regarded as the most useful services a hub could provide, rated as “valuable” by 89%, 88% and 87% respectively. In addition, enhanced connectivity to banks, lenders and private investors ranked highly.

In terms of the location of the hub, Birmingham and Manchester were, by some distance, the most popular choices — a reflection of their relatively central location compared to other options as well as their existing status as strong business centres with good transport links. Birmingham ranked as the top choice with 27% of the vote, with Manchester marginally behind with 26%.

Amanda Blanc, CEO, of AXA’s commercial business, said: “It’s clear from what these SME leaders have told us, across the country, that there is widespread fear the economy is not only unbalanced in favour of London but that businesses operating outside the capital are at a competitive disadvantage.

“One way of addressing this pressing issue is the creation of an SME hub - but what would it look like? Our report shows there is a critical need for legal, financial and regulatory advice and a more structured model to access funding so the hub could take the form of a ‘national business advice centre’.

“Whatever form it would take, the most important thing is that it needs tangible support from the Government. Our research highlights the growing concerns SMEs have about the lopsided development of our national economy. If the Government is serious about supporting SMEs, and it truly believes that SMEs are the lifeblood of our economy, then I encourage it to show its support in real terms.”