Demand for Invoice Financing Grows as Business Lending Falls at the Fastest Rate Since Records Began Reports Simply Business
Simply Business at www.simplybusiness.co.uk report an increase in small businesses seeking alternative sources of credit such as invoice discounting and factoring as banks refuse to give credit.
Business lending is failing at the fastest rate since records began, with a drop of GBP4 billion between March and May of this year. SMEs in particular have been strongly affected with lending down by 4.2% according to a recent report from the Bank of England. This situation is clearly taking its toll with the Centre for Economic and Business Research (CEBR) suggesting that 47% of small business owners are relying on personal loans, credits cards and savings to keep their firms afloat.
Similarly, Simply Business are seeing increased numbers of small businesses turning to alternative finance options such as factoring and invoice discounting in order to improve cash flow. Invoice finance is a type of asset based lending where a business uses their sales ledger as collateral for a cash advance. It's a flexible finance option which grows with your business, allowing your company to achieve its full potential unlike traditional forms of lending (loans, overdrafts).
Jason Stockwood, CEO of Simply Business said:
"For many small business owners invoice finance has been a great option in terms of easing cash flow problems, however it's clear that UK business owners are in need of more credit options - particularly with a view to growth. Being forced to rely on personal finance is clearly unacceptable and could certainly impact the economic recovery."
About Simply Business
Simply Business is the UK's largest business insurance provider.
Launched in 2005, the full service insurance specialist identified a need to improve insurance offerings for the UK's millions of small businesses whose needs were neglected by established insurance and broking companies. Where the traditional broking model was slow-moving and inflexible, Simply Business developed an agile and online brokerage service which was able to deliver bespoke policies tailored to their individual and often very specific requirements. Its online offering is supported by a dedicated, UK based team of insurance specialists who provide a tailored and personal service more commonly associated with broker relationships.
Today, Simply Business insures over 170,000 small business customers, more than any other UK broker. It has been a Sunday Times Tech Track 100 company for the past three years, with offices in London and Northampton, and employs over 140 people. Simply Business revenues have grown 44% a year from GBP4.2 million in 2006, to GBP12.5 million in 2009.
Source: Simply Business
Read more at www.simplybusiness.co.uk