Over recent months, I seem to be talking to more and more companies who have lost faith in their banks, and have all but given up on approaching their banks when it comes to seeking finance for their business. With the main high street banks seemingly asking people to be the perfect client before agreeing to lend (and begging the question why would you need to borrow money if you already have it?), it seems as if people are running out of options.
This is where there seems to be a great opportunity for the invoice finance/asset based finance market to step up and really play a part in re-building the economy. It would appear more companies are turning to invoice finance as a means to grow their business, as more people lose faith in the traditional sources of funding. according to a recent survey, 80% of the 250 accountancy firms interviewed, agreed with this, with 53% growing as far as to say asset based lending was the most effective for business growth.
It would appear as well that factoring is finally managing off the shake off the shackles of being associated with poor companies with no money. For a time it appeared that endless bank borrowing and loans was fine, but asset finance was frowned upon, and seen to be the last resolve of a company nobody else wanted to touch. It's time for this to change once and for all, and the business world to recognise a valuable source of funding which will surely play an integral part as we strive to trade our way out of recession, and avoid the dreaded double dip.
As always, credit insurance has its part to play as well. Aligning a credit insurance alongside your finance facility can maximise the effectiveness of your facility. Often allowing for higher levels of funding, more favourable lending rates, and most importantly more security for you and your funder, the two products can play an integral part in helping your business to grow safely and securely.
For more information about credit insurance, factoring and invoice discounting, please contact me via twitter, LinkedIn, and through www.exchangeis.net.
As always, your comments and feedback would be greatly appreciated.
