Growth beneath the surface: The real story behind SME credit trends
UK SME credit demand strengthened in Q4 2025, with applications and new lending volumes rising even as economic uncertainty, cost pressures and affordability challenges persist. Growth is being driven by lower‑value and working capital products, while higher‑value investment lending has slowed and risk profiles are beginning to shift.
The UK SME Credit Trends Index reveals where lending momentum is building, where vulnerabilities are emerging, and what macroeconomic and policy changes mean for 2026.
Download the report to get the insight lenders need to balance growth, risk and responsible lending in a changing SME market.
In this report, we cover:
SME credit trends to watch
We look at demand and supply, the role of alternative lenders, and credit performance highlights.
Macroeconomic outlook
How economic trends are shaping SME resilience.
SME demands
How demand for credit is reflected into lending and SME delinquency rates.
A sneak peek into...
Experian UK Small and Medium-Sized Enterprise (SME) Credit Trends Index
Mark England, Head of Commercial Insight, Data Office, Experian
Foreword
The latest UK SME Credit Trends Index presents a picture of resilience set against a fragile and shifting economic backdrop.
Headline inflation has eased from its peak, but remains sufficiently embedded, particularly in services, to constrain real wage growth and suppress broader confidence. With GDP growth expected to remain modest and risks tilted to the downside in 2026, SMEs are operating in an environment shaped by elevated input costs, tax and wage policy changes, and continued geopolitical and financial market volatility.
Despite these headwinds, credit demand has strengthened. SME applications returned to growth in Q3 and accelerated into Q4, with searches up 6% quarter-on-quarter and 21% year-on-year. This recovery in demand has translated into rising new lending volumes,
up 19% year-on-year, with growth particularly concentrated in lower-value and working capital products. Asset finance and cards have been especially robust, while mortgage lending has remained strong.
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