Factoring Partners blog 22/4/16


neither a borrower nor a lender be
neither a borrower nor a lender be

As a Stratford upon Avon based business it would clearly be appropriate this week to write the blog in the style of William Shakespeare, given all the celebrations taking place both locally and nationally this week end.

Alas, and that’s about as far as that attempt goes, Shakespeare aside, the week has seen more entrants to the business finance market, or at least I have found three new alternatives to add to the database of financiers. One is a specialist trade financier the other a Peer to Peer (P2P) lender using the debtor as the cornerstone of its security and the other a pure invoice financier.

The database is beginning to struggle under the weight of all options now available and keeping on top of credit and underwriting policies will be challenging. To a business seeking funds the opportunities have never been more extensive but the overwhelming number of alternatives presents a confusing picture.

Some funders will not survive either through an inability to write new business and others will fall victim of customer bad debts or even fraud. As the number of funders increase pressure will mount on all staff to acquire new business and costs will be reduced and corners will be cut.

This may well cause issues with borrowers conceivably caught up in the aftermath of their funder failing and the irony would be if one of the banks has to effect a rescue of any sort.

Maybe Shakespeare had a point when he said ‘neither a borrower or lender be’  today he probably would have added something like…but if you have to raise finance for your business always speak to an independent broker first.