Irish SMEs say financial admin is holding growth back

Monzo has published research on barriers to growth for Irish small and medium-sized businesses, with financial administration ranking alongside economic uncertainty for many firms.

A survey of 1,000 owners and senior decision-makers at Irish SMEs found that 27% said time spent on administration or the complexity of managing finances was a barrier to growth. The same share cited economic uncertainty.

The report points to a build-up of digital tools rather than a reduction in workload. Businesses use an average of five tools, apps or platforms to manage money across banking, accounting, invoicing, payments, payroll and tax.

That fragmented approach appears to be adding to pressure on owners and managers. Seven in 10 respondents said they regularly switch between platforms, 65% said they have to combine information from multiple sources to get a full picture of their finances, and 43% said they have had to enter the same information into more than one system.

More tools

The research suggests many SMEs adopted additional digital services in recent years without making the experience simpler. Some 64% said they started using more digital tools and services in 2020, yet 67% said running a business feels more complicated now.

Businesses also said they want closer links between the systems they already use. Nearly two-thirds, or 62%, said they want their financial tools and platforms to be better integrated.

Expectations of banks have also shifted. Nearly half of respondents, 49%, said they expect more from their business banking provider than they did in 2020, while 61% said they still use other tools because their bank does not offer everything they need.

These findings come as business owners continue to balance inflation, borrowing costs and wider uncertainty with day-to-day demands on their time. The figures suggest routine financial tasks are competing with growth plans for management attention.

Time pressure

More than two in five respondents, 44%, said the time they spend on financial administration holds their business back from growing. One in five said it has stopped them from investing in equipment, technology or premises, while 19% said it has held them back from hiring.

The report also sets out the effect on working patterns and wellbeing. Some 45% said managing finances is a significant source of stress, while 47% said they often or always work evenings or weekends because of financial administration.

Another 43% said they regularly skip or work through lunch, and 38% said they often feel unable to switch off outside work. Among the most stressful tasks named were preparing tax returns, chasing unpaid invoices and managing cash flow.

For all that, the survey suggests many Irish SMEs remain focused on expansion. Half of respondents said they were confident about growing over the next year.

When asked what simpler financial administration could make possible, 65% said it would free up time to focus on the things that matter most to their business. Some 31% said they would pursue new customers or markets, 29% said they would invest in equipment, technology or premises, and 32% said they would reduce their own working hours.

"Irish SMEs have no shortage of ambition, and financial admin should be the last thing holding them back. Our research shows that simply adding more digital tools isn't making running a business simpler. When tools don't work together, the work falls back on business owners, often long after the working day should have ended. At Monzo Business, we're bringing banking, invoicing, accounting and other essential tools together in one app, so entrepreneurs can spend less time on admin and more time growing their business," said Elaine Deehan, Country Manager for Ireland at Monzo.

The survey was conducted by Strand Partners and was designed to be nationally representative of Ireland's small and medium-sized business population by business size, sector and region. Respondents were screened to ensure they had decision-making authority over banking and financial tools.

The research marks the first edition of Monzo's Money Moves Report focused on Irish SMEs. Monzo said it serves more than one million business customers, with Dublin acting as its European headquarters.

The findings underline a basic tension for smaller businesses: digital adoption has widened, but for many operators the added systems appear to have increased complexity rather than reduced it, leaving administration to absorb time that might otherwise go into hiring, investment or winning new customers.