The British Chambers of Commerce (BCC) has made improving access to finance for small businesses a key focus of its submission to the Chancellor ahead of his Autumn Statement. The performance of invoice finance means that advice on alternative SME finance is vital.
The BCC has called for the Chancellor to offer 20,000 companies growth vouchers worth up to £5,000 for finance advice and help with business planning and taking on more staff. The rising popularity of alternative SME finance and its growing mainstream status suggest that this advice must include information on services such as invoice discounting and factoring.
That alternative finance looks set to play a major role in the British business bank, which will bypass traditional banks, has underlined the status of the sector, and services such as invoice finance and asset-based finance, as an established source of SME finance.
Asset Based Finance Association Q2 2012 data further emphasised the growth of the alternative finance sector, with invoice discounting driving forward momentum. New figures from the Finance & Leasing Association only confirm this continued ascendency: in Q3, broker and sales finance grew by 3% and 11% respectively. New asset finance business for deals of up to £20 million grew to £5.1 billion.
It’s an important time for initiatives such as the Funding for Lending scheme, the Business Finance Partnership and the Start-Up Loans Company, and it seems imperative to their chances of success, and to that of the SME bank, which will need the strongest possible platform, that third-party finance plays a key role going forward.
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