Just 6% of respondents expressed confidence in the government’s approach, citing the impact of measures such as national insurance tax increases and employment reforms as key barriers to growth.

In terms of deal activity, advisers highlighted macroeconomic uncertainty and deal quality as the primary constraints on activity, with 34% reporting a reduction in their own deal pipelines.

However, despite ongoing political and macroeconomic challenges, corporate finance advisors remained cautiously optimistic for H2 2025, with 35% of respondents expressing cautious optimism, up from the previous survey which followed the Autumn Statement.

According to ThinCats, market stability, funding availability, and pent-up demand  were seen as key drivers of this sentiment.

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Additionally, 48% said there was increasing demand for funding from owner-managed businesses — while 38% of advisers reported a decline in deal activity in the first few months of 2025, with a further 27% saying the market was flat.

Ravi Anand, managing director at ThinCats (pictured above), commented: “It has been a challenging few months in the lending market.

“But to see the majority of advisers report that they believe the current governments approach to be actively damaging to UK SMEs is troubling to see. 
“Following the Autumn Statement, many businesses have basically paused on any growth or acquisitions.

“Wider geopolitical issues are raising concerns about government debt and expectations of rate decreases by the BoE.

“Despite these challenges, the good news is that businesses in the mid-market are resilient and advisers are picking up on positive sentiment. Hopefully, we will see more activity into the rest of 2025.”