UK Regional Invoice Finance and Business Statistics 2026
The UK's 5.7 million private sector businesses are heavily concentrated in London and the South East, which together host over a third of all VAT and PAYE registered firms. UK Finance recorded £22.7bn in invoice finance and asset based lending advances in 2025 across 40,100 businesses, while external finance use ranges from 52% in Northern Ireland to sharp regional declines elsewhere.
Key statistics
Total funds advanced to UK businesses through invoice finance and asset based lending, 2025. Source: UK Finance
UK businesses using invoice finance or asset based lending facilities at the end of 2024. Source: UK Finance
Of those, businesses using confidential invoice discounting. Source: UK Finance
Of those, businesses using invoice factoring. Source: UK Finance
Total UK private sector businesses at the start of 2025. Source: Department for Business and Trade, Business Population Estimates 2025
Share of UK private sector businesses classed as SMEs. Source: Department for Business and Trade, Business Population Estimates 2025
VAT and/or PAYE registered businesses in London, the largest of any UK region (19.7% of the UK total). Source: ONS, UK Business: Activity, Size and Location 2025
VAT and/or PAYE registered businesses in the South East, the second largest regional total (14.8%). Source: ONS, UK Business: Activity, Size and Location 2025
Combined share of VAT/PAYE registered UK businesses located in London and the South East. Source: ONS, UK Business: Activity, Size and Location 2025
VAT and/or PAYE registered businesses in Scotland (6.3% of the UK total). Source: ONS, UK Business: Activity, Size and Location 2025
VAT and/or PAYE registered businesses in Wales (3.8% of the UK total). Source: ONS, UK Business: Activity, Size and Location 2025
VAT and/or PAYE registered businesses in Northern Ireland (2.9%), up 1.5% year on year, the fastest regional growth. Source: ONS, UK Business: Activity, Size and Location 2025
VAT and/or PAYE registered businesses in the North East, the smallest regional total (2.7%). Source: ONS, UK Business: Activity, Size and Location 2025
Proportion of UK smaller businesses using external finance in 2024, broadly stable year on year. Source: British Business Bank, Nations and Regions Tracker 2025
External finance usage among smaller businesses in Northern Ireland, the highest of any UK nation or region in 2024. Source: British Business Bank, Nations and Regions Tracker 2025
Fall in external finance usage in the East Midlands in 2024, the sharpest regional decline recorded. Source: British Business Bank, Nations and Regions Tracker 2025
Bank of England base rate, last changed 18 March 2026, the reference rate against which most invoice finance discount charges are set. Source: Bank of England
| Metric | Value | Source |
|---|---|---|
| Total funds advanced to UK businesses through invoice finance and asset based lending, 2025 | £22.7bn | UK Finance |
| UK businesses using invoice finance or asset based lending facilities at the end of 2024 | 40,100 | UK Finance |
| Of those, businesses using confidential invoice discounting | 30,200 | UK Finance |
| Of those, businesses using invoice factoring | 9,900 | UK Finance |
| Total UK private sector businesses at the start of 2025 | 5.7 million | Department for Business and Trade, Business Population Estimates 2025 |
| Share of UK private sector businesses classed as SMEs | 99.85% | Department for Business and Trade, Business Population Estimates 2025 |
| VAT and/or PAYE registered businesses in London, the largest of any UK region (19.7% of the UK total) | 538,000 | ONS, UK Business: Activity, Size and Location 2025 |
| VAT and/or PAYE registered businesses in the South East, the second largest regional total (14.8%) | 405,000 | ONS, UK Business: Activity, Size and Location 2025 |
| Combined share of VAT/PAYE registered UK businesses located in London and the South East | 34.5% | ONS, UK Business: Activity, Size and Location 2025 |
| VAT and/or PAYE registered businesses in Scotland (6.3% of the UK total) | 173,000 | ONS, UK Business: Activity, Size and Location 2025 |
| VAT and/or PAYE registered businesses in Wales (3.8% of the UK total) | 105,000 | ONS, UK Business: Activity, Size and Location 2025 |
| VAT and/or PAYE registered businesses in Northern Ireland (2.9%), up 1.5% year on year, the fastest regional growth | 80,000 | ONS, UK Business: Activity, Size and Location 2025 |
| VAT and/or PAYE registered businesses in the North East, the smallest regional total (2.7%) | 73,000 | ONS, UK Business: Activity, Size and Location 2025 |
| Proportion of UK smaller businesses using external finance in 2024, broadly stable year on year | 45% | British Business Bank, Nations and Regions Tracker 2025 |
| External finance usage among smaller businesses in Northern Ireland, the highest of any UK nation or region in 2024 | 52% | British Business Bank, Nations and Regions Tracker 2025 |
| Fall in external finance usage in the East Midlands in 2024, the sharpest regional decline recorded | 9 percentage points | British Business Bank, Nations and Regions Tracker 2025 |
| Bank of England base rate, last changed 18 March 2026, the reference rate against which most invoice finance discount charges are set | 4.50% | Bank of England |
Source: UK Finance, Department for Business and Trade, Business Population Estimates 2025, ONS, UK Business: Activity, Size and Location 2025, British Business Bank, Nations and Regions Tracker 2025, Bank of England
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### UK Regional Invoice Finance and Business Statistics 2026: key figures | Metric | Value | Source | | --- | --- | --- | | Total funds advanced to UK businesses through invoice finance and asset based lending, 2025 | £22.7bn | UK Finance | | UK businesses using invoice finance or asset based lending facilities at the end of 2024 | 40,100 | UK Finance | | Of those, businesses using confidential invoice discounting | 30,200 | UK Finance | | Of those, businesses using invoice factoring | 9,900 | UK Finance | | Total UK private sector businesses at the start of 2025 | 5.7 million | Department for Business and Trade, Business Population Estimates 2025 | | Share of UK private sector businesses classed as SMEs | 99.85% | Department for Business and Trade, Business Population Estimates 2025 | | VAT and/or PAYE registered businesses in London, the largest of any UK region (19.7% of the UK total) | 538,000 | ONS, UK Business: Activity, Size and Location 2025 | | VAT and/or PAYE registered businesses in the South East, the second largest regional total (14.8%) | 405,000 | ONS, UK Business: Activity, Size and Location 2025 | | Combined share of VAT/PAYE registered UK businesses located in London and the South East | 34.5% | ONS, UK Business: Activity, Size and Location 2025 | | VAT and/or PAYE registered businesses in Scotland (6.3% of the UK total) | 173,000 | ONS, UK Business: Activity, Size and Location 2025 | | VAT and/or PAYE registered businesses in Wales (3.8% of the UK total) | 105,000 | ONS, UK Business: Activity, Size and Location 2025 | | VAT and/or PAYE registered businesses in Northern Ireland (2.9%), up 1.5% year on year, the fastest regional growth | 80,000 | ONS, UK Business: Activity, Size and Location 2025 | | VAT and/or PAYE registered businesses in the North East, the smallest regional total (2.7%) | 73,000 | ONS, UK Business: Activity, Size and Location 2025 | | Proportion of UK smaller businesses using external finance in 2024, broadly stable year on year | 45% | British Business Bank, Nations and Regions Tracker 2025 | | External finance usage among smaller businesses in Northern Ireland, the highest of any UK nation or region in 2024 | 52% | British Business Bank, Nations and Regions Tracker 2025 | | Fall in external finance usage in the East Midlands in 2024, the sharpest regional decline recorded | 9 percentage points | British Business Bank, Nations and Regions Tracker 2025 | | Bank of England base rate, last changed 18 March 2026, the reference rate against which most invoice finance discount charges are set | 4.50% | Bank of England | Source: UK Finance, Department for Business and Trade, Business Population Estimates 2025, ONS, UK Business: Activity, Size and Location 2025, British Business Bank, Nations and Regions Tracker 2025, Bank of England
“The ONS regional business counts used here cover only VAT and PAYE registered businesses, a narrower base than the Business Population Estimates total of 5.7 million, so the two figures should not be compared like for like. UK Finance does not publish invoice finance client numbers by nation or region, so regional invoice finance demand can only be inferred from general business density and finance usage data, not measured directly.”
What the numbers mean
Invoice finance demand tends to follow business density, and the UK's business population is not spread evenly. Department for Business and Trade figures put the total number of UK private sector businesses at 5.7 million at the start of 2025, of which 99.85% are small or medium sized enterprises.
ONS data on VAT and PAYE registered businesses shows London alone accounts for around a fifth of the national total, with London and the South East combined making up over a third. Regions such as the North East, Wales and Northern Ireland each hold a much smaller share, though Northern Ireland was the fastest growing region for business numbers in the year to March 2025.
UK Finance does not publish invoice finance client numbers by nation or region, so the closest available proxy for regional demand is the British Business Bank's annual Nations and Regions Tracker, which measures external finance use among smaller businesses.
Usage held broadly steady at 45% across the UK in 2024, but the regional picture was uneven: Northern Ireland recorded the highest uptake at 52%, while the East Midlands saw the sharpest fall, down nine percentage points. Invoice finance and asset based lending advances reached £22.7bn nationally in 2025 across more than 40,000 businesses, split between confidential invoice discounting and factoring facilities.
Discount charges on these facilities are typically priced against the Bank of England base rate, currently 4.50%, plus a margin set by the individual lender.
FAQs
Which UK region has the most businesses?
London, with around 538,000 VAT and PAYE registered businesses in 2025, 19.7% of the UK total, according to the ONS. Combined with the South East's 405,000, the two regions hold over a third of the UK's registered business base.
Does UK Finance publish invoice finance statistics by region?
No. UK Finance's invoice finance and asset based lending statistics, including client numbers, advances and sector splits, are reported at national level only, with no official breakdown by nation or region.
Which UK nation or region has the highest use of external business finance?
Northern Ireland, at 52% of smaller businesses using external finance in 2024, the highest of any UK nation or region, according to the British Business Bank's Nations and Regions Tracker 2025.
Is external finance use rising across the UK?
It was broadly stable in 2024 at 45% nationally, only one percentage point below 2023. The picture varied sharply underneath that average, with roughly half of UK regions recording declines, including a nine point fall in the East Midlands.
Does the Bank of England base rate affect invoice finance pricing differently by region?
No. The base rate, 4.50% since 18 March 2026, is a single national reference rate. Regional differences in invoice finance pricing come from individual lender margins and risk assessment, not the base rate itself.
Founder & Managing Director, Muswell Rose, founder and PSC of Best Business Loans Ltd
Adam is the founder and managing director of Muswell Rose and a founder of Best Business Loans Ltd, the company behind Market Invoice. He spent over three years as managing director of Penny, a UK invoice finance business, and his career runs through insurance, mortgages, commercial finance and fintech lending. He writes the Market Invoice library.
Last reviewed: 14 August 2026