Tag Archives: SME Finance

Weekly digest

The week completed, 18th September 2015

JMS

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!

rugby

Weekly digest

The week completed, 12th December 2014

JMS

Christmas is most definitely here and businesses are deferring decisions to the New Year. This can be a little frustrating as funders are willing to offer and complete facilities and there is still plenty of time.

Two dreadful instances this week of large businesses deliberately extending payment terms to small suppliers seemingly with no legitimate reason. There’s no good time or reason for this practice and some large buyers seem to adopt an unacceptable almost macho stance in squeezing suppliers.

Without the permission of my client I clearly cannot name these well known businesses. Its a recurring and ongoing subject and sadly for SME’s I guess will continue.

I will be losing my bet, made this time last year, that Bank of England Base Rate would have risen from 0.5% by Christmas 2014. (Given the absence of any further MPC meetings this year Base Rate will end the year at 0.5%). Economically Base Rate needs to rise next year but this is unlikely before May. Although the Bank of England sets Base Rate free from political interference, I am a cynic!

The week has been punctuated by a couple of Christmas networking events with more next week too. Also next week will see a visit to a High Street to give the retailers a boost.