Two-thirds of the UK’s businesses didn’t secure any new financing in the six months to October 2012, according to a recent survey from Hilton-Baird Financial Solutions.
Now in its third year, the biannual SME Trends Index questioned 415 business owners and finance directors during October on their company’s performance, expectations and funding habits, and found that only 34% secured new funding in the preceding six months.
The Prime Minister has announced a new supply chain finance scheme that is hoped to address the cash flow challenges faced by so many small businesses at present.
The scheme will see the country’s largest businesses asked to notify their banks as soon as they approve a supplier’s invoice, thereby giving the bank the assurance it will be paid and enabling them to advance the invoice value to the supplier.
As traditional bank lending declines further, the asset based finance industry has been confirmed to have expanded over the past few months as both the level of funding advanced and client numbers increased on an annual basis.
Are you suffering from customers delaying payments?
Are some of your debtors simply unable to pay?
Are bad debts stifling your business?
Amid the ongoing challenges businesses are reportedly facing in accessing traditional forms of funding in the current economic environment, the trade organisation representing the asset based finance industry has delivered some timely news to owners of businesses large and small.
Cabinet Minister Francis Maude has revealed that the government is on course to more than double its expenditure with small and medium-sized firms from 2010 levels by the end of the month. This, combined with recent figures from the Asset Based Finance Association, will hopefully go some way towards easing some of the most common cash flow problems facing SMEs at present.
It's no secret that businesses of all sizes are finding it more difficult than ever to access traditional funding, required in order to meet their day-to-day commitments and invest in growth. But are they looking in the right place?
Are you relying on an overdraft to fund your business? Is the inflexible nature of your overdraft restricting the amount of cash you can access? Could your business do with a financial boost?
It’s a challenge that thousands of small and medium-sized businesses have encountered in recent times, but help is at hand. By releasing up to 90% of an invoice's value within 24 hours, invoice finance can provide an immediate cash injection for your business to help bridge the gap between billing and getting paid – commonly experienced when trading on credit terms. Invoice finance comes in several forms, including factoring and invoice discounting, ensuring facilities can be tailored to a range of requirements.
The latest study from YouGov raises some serious questions over the availability of credit for the UK's one million micro-firms, with one in four worried their business could fold in the next two years. Accounting for more than 90% of the UK's businesses, micro-firms – classed as a business employing less than ten people – are undeniably the engine of the economy, which makes it even more important that they are given the support that's necessary in order to secure their financial stability.
Throughout 2011 more SMEs in the UK found it difficult to source funding, given most were looking at their banks for an overdraft and so were being turned down, given access to credit continued to tighten.