Invoice finance

The pros and cons of upfront payment and credit terms

The decision as to whether or not to offer credit terms can be difficult. The balance between protecting your business from the potential risks involved and providing an attractive proposition to win and subsequently retain customers is tricky.

Take a look at the range of pros and cons of both upfront payment and credit terms...

Is help for businesses on its way?

After various rumours, it has been confirmed by the Bank of England that the Funding for Lending Scheme (FLS) is to be revitalised.

Set up in July 2012, the FLS was announced by George Osborne to encourage lending to businesses by providing banks with cheap loans with the stipulation that they will be passed on to customers.

However many critics claim it has not been as successful as expected, further fuelled by the recent statistics that show lending to businesses was down by £4.8bn in the three months to February 2013.

Evidence given at late payment inquiry

Last week we posted a blog discussing whether a 20% VAT penalty would help put a stop to late payers. Many readers expressed concerns over how the proposal would actually work in reality and vented frustrations over how late payment is such a common practise.

At Hilton-Baird we hear from many businesses who are deeply affected by late payments on a daily basis, so we were excited to hear the news that a meeting had been set up between parliamentarians and businesses to discuss the ongoing issue of late payments and how big the problem is.

The meeting, which took place on Tuesday, was chaired by Labour MP Debbie Abrahams and consisted of four panels made up of business groups, including the Forum of Private Business, representatives from FTSE listed companies, one of suppliers, and one of business and economics experts.

Government funding to be extended?

Reports spread around various news channels at the weekend that George Osborne is set to announce an expansion to the £80bn Funding for Lending Scheme (FLS) in an attempt to help boost lending to businesses.

According to the Telegraph and the Financial Times, the expansion will reach out to a range of asset finance providers, who borrow against machinery, premises or invoices, as opposed to traditional loans.

These reports came out as the Bank of England revealed that lending to businesses throughout the UK fell by a further £4.8bn in the three months to February, equating to a 4.4% drop in loans to companies when compared with the previous year.

Stepping away from the norm

With lending to businesses found to have fallen again during the final quarter of 2012 and evidence suggesting that more and more businesses are ditching traditional bank lending in favour of more targeted cash flow solutions, what steps are you taking?

Business Minister to hold banks to account over EFG

Back when it was launched in 2009, the Enterprise Finance Guarantee was being heralded as a funding lifeline for UK businesses. But after an encouraging start, the value of funding provided through the initiative has fallen by 67% since peaking in Q3 2009.

This has prompted Business Minister, Michael Fallon, to promise he will “hold banks to account” until lending under the scheme improves.

Comparing invoice finance solutions

Are you searching for a new funding solution for your business? Have you heard of invoice finance but are unsure of which solution is right for you?

Confidence highest amongst asset based finance users

Recent research has indicated that UK businesses are largely apprehensive about what the early part of 2013 will bring.

However the latest SME Trends Index, conducted by commercial finance broker Hilton-Baird Financial Solutions in October 2012, discovered that those using asset based finance to fund their business were most confident about the future having outperformed other businesses in the preceding six months.

Start-up loans fail to take off

The Government last week expanded the Start-up loans scheme in a frantic bid to encourage more young and budding entrepreneurs to set up their own business.

With so many out of work and even the most established businesses suffering, the scheme was initially introduced in May 2012 to offer low-interest funding to 18-24 year olds looking to start a company. But with just £1.5 million lent so far under the scheme out of £82 million available, the Government has moved to dramatically expand the initiative.

Enter 2013 with your business on the front foot

Ensuring timely customer payments and adequate cash flow over the festive period can be a real challenge.

As your customers begin to relax and get consumed by all things Christmas, it’s essential that as a business owner you remain vigilant in order to ensure invoices are paid and your cash keeps flowing in order to enter the New Year in good financial health.