Contractors and others running start-up businesses will find it difficult to secure funding during 2011, according to one expert.

John De Groot, chairman of Success Strategy said that funding prospects will only worsen as the next phase of the economic situation really kicks in.

He said that there is a continuing reduction in the quality of business support by the government as a result of lack of funding.

"The situation will also be aggravated by an increasing number of potential new start-ups that always result from a downturn in the economy, and in particular an increase in unemployment, causing more people than would be normal to consider self-employment as an alternative," added Mr De Groot.

Meanwhile, research by Investec Specialist Private Bank said that one in four top entrepreneurs will be looking to venture capitalists and private equity for funding in the coming year.