Research this week reveals that over 70% of SME’s have no human contact with their bank. (As a business we make many calls to Britain’s small business community and if anything it feels like this figure is higher.) Banks have a wealth of data and experience gathered over years of customer relationships so ought to be a valuable source of advice and guidance.
The banks failings in recent years has dented their own credibility in most areas but simply now being seen as commodity providers leaves the SME community with fewer places to turn for support.
In contrast businesses that use invoice finance have access to a relationship manager and those that use the smaller invoice financiers will often have access to a Director with instant decision making capabilities, particularly useful in terms of access to quick funds. Likewise the invoice financiers sit on a great deal of data as it relates to the payment history of many businesses both domestic and international. This can be really useful in evaluating credit risk
Not only will the invoice financiers give clients greater funding levels but a genuine relationship is offered too with the emphasis on the creation of partnerships.
Statistics from The Asset Based Finance Association (ABFA) show that 43,921 businesses were using some kind of invoice finance as at the end of June 2015, a fraction of the number of small businesses as a whole in the UK and only a very small increase over the previous quarter.
Despite the clear benefits invoice finance can bring, both in terms of finance and relationships, the overall message isn’t getting across as well as it should to the SME community.
Highlight of the week is this evening with the start of the 2015 Rugby World Cup and the host nation beginning a smooth passage through to the final in 6 weeks time!