A lack of financial confidence is stifling Britain’s entrepreneurial potential, according to a new report from Xero’s Financial Confidence Taskforce, which is calling for a government-led overhaul in financial education. The coalition — made up of business, accountancy, and education leaders — argues that financial literacy must be taught earlier and more practically to unlock growth among small enterprises.
Research commissioned by Xero found that 28% of small business owners do not know if they were profitable last month, and over half (55%) struggle with cash flow management. A similar proportion admit they are “not a numbers person,” a self-perception that often leads to missed opportunities and reluctance to seek investment.
The report found younger entrepreneurs particularly disadvantaged: 35% of 18- to 34-year-olds say they lack the financial skills to manage a business, compared with 16% of those aged 55 and over. Nearly one in three younger respondents (29%) said the financial side of running a business proved harder than expected — evidence, the taskforce argues, of a “real-world shock” between ambition and administration.
Kate Hayward, UK Managing Director at Xero, said the findings show a need to rethink how finance is taught and perceived. “We’re a nation of small businesses, but not one that teaches people to be excited by entrepreneurship,” she said. “Fear of figures can quickly turn people’s aspirations into what might feel like an impossible dream. We’re calling for a radical rethink of how to improve financial literacy and show people that running a business is an amazing and rewarding career.”
The taskforce’s framework — “want it, know it, do it” — calls for a national strategy to build both ambition and practical experience. It proposes making enterprise aspirational through school-based business activities, embedding financial skills into apprenticeships, and recognising hands-on experience through a new national business confidence badge.
Taskforce member Grace Hardy, a chartered accountant and financial education advocate, said young people need relatable examples of financial success. “You can’t be what you can’t see,” she said. “It’s critical for young people to see role models who show that financial confidence is a skill anyone can unlock.”
The taskforce also recommends appointing a single government minister for financial literacy and simplifying the UK tax system to make business ownership less daunting.
Members include Tara Askham, global finance trainer; Tim Barnes, CEO of the Centre for Entrepreneurs; Martin Bissett, business advisor; Sarah Porretta, CEO of Young Enterprise; Graeme Tennick, founder of Tennick Accountants; Zoe Whitman, co-founder of Six Figure Bookkeepers; and Philip Salter, founder of The Entrepreneurs Network.
You must be logged in to post a comment.