64% of small business owners expect demand for alternative finance – including forms such as property finance, crowdsourcing, invoice finance and asset finance – to increase over the next two years while just 8% think it will decline, according to research from specialist lender Amicus.

Small firms predict demand for alternative finance will increase by an average of 26% over the next two years. In 2014 the total amount raised through alternative forms of lending was an estimated £1.74 billion, double that of 2013.

42% of small businesses said they considered using alternative finance in the last five years. The most popular option, considered by 24% of respondents, was crowdsourcing finance, including peer-to-peer lending and crowdfunding, followed by cashflow/invoice finance (18%), property finance such as bridging loans and commercial mortgages (8%) and asset finance (6%), which covers areas such as plant and machinery and business equipment.

On a regional basis, 77% of small business owners in London predict a rise in demand for alternative finance, the largest portion in the UK. Business owners in Scotland and Wales were equal second with 69%. SMEs in the West Midlands were the least enthusiastic about alternative finance with just over half (53%) anticipating an increase.

John Jenkins, CEO of Amicus, said: “This research shows that the business finance landscape has changed for good and demand for alternative finance is set to go from strength to strength over the coming years.

“Small businesses are increasingly turning to specialist lenders who have the skills to understand their specific needs. Having built a strong business base from our property lending expertise we are broadening our proposition into other areas of lending.

“Our relationship-based approach resonates well in specialist lending markets that are poorly served by mainstream lenders.”