introduction
The government has announced new initiatives to help diversify business finances which will be led by British industry experts from the business and financial sector.
The British business is still very dependent on bank funds to help finance their business activities even though there are many alternative funding sources available to them in the current financial markets.
The government wants to ensure, given the recent and current banking reform, that the financial flow of business is maintained. Alternative financial sources will be very important to help business provide broader economic growth in the UK economy.
The expert panel will seek to build alternative financial source framework by working with business and business investors, financial institutions and alternative financial providers to coordinate and facilitate the availability of funds needed by business.
Bank loan
Although there has been an increase in new loans from the biggest bank this year many businesses are still unhappy with bank loan levels and how they are treated by their banks.
A more stringent loan criteria, non-renewal of bad overdraft facilities and communication by the bank are a common problem quoted by business as their funding goals difficult to achieve.
No finance they need, British business struggles to survive and grow, and the British economy does the same. This is why the government does not only introduce a scheme to increase bank loans but also want to encourage as many competition as possible in the financial market and provide various sources of financial alternative to the UK business.
Alternative finance
There are already various alternative financial sources available for business.
One of the biggest obstacles to increasing this financial resource taking is only a general awareness. Providers of new and new alternative financial products appear do not have branch infrastructure that make the distribution of their products efficient and effective.
Another important factor here is that many owners and small and medium business managers, which are the backbone of the British economy, do not realize the various alternative finance available and where to find it.
The new communication method is needed and expected this will be the main goal of government initiatives.
Finance invoice.
Finance Invoice is one of the most popular choices in alternative financial portfolios and has grown over the past fifteen years of around 13,000 companies that use it in the UK to more than 50,000 companies now.
This very flexible business financial method advances funds to unpaid sales invoices. There is a variation in the Finance Family of product invoice that includes invoice factors and invoice discounts.
The invoice financial lender will advance up to 95% of the company’s sales invoices that have not been paid and use ledgers as security by taking the assignment of invoices and debt effectively owned by them.
When the invoice is paid by the company’s customers, the financial invoice company will pay for the balance of the invoice that has not been funded after deducting their costs. Usually there are fees for interest facilities and interest costs for advanced funding.
One of the main benefits of financial invoices is that the facility will grow when businesses grow, making it a very effective method for funding working capital.
