The world of commercial finance for SME’s has changed. The rise of challenger banks and alternative finance providers such as peer-to-peer, crowdfunding and private equity is at an all-time high. Alternative Finance, which is an umbrella term for business finance from lenders outside of the high street banks and mainstream capital markets, is not necessarily a new concept but is currently growing at breakneck speed, with more and more SME’s turning to alternative lenders for their finance solutions.
The boom in technology, specifically digital technology has made it easier, but more importantly faster, to do business. To survive in today’s marketplace, SME’s need the ability to move quickly and this includes with their finance. This opens a huge opportunity for alternative lenders to step in, where consumers may be happy to pay a slight premium if it means greater speed and responsiveness. Some high street banks have even spawned their own “challenger banks” to compete in this area.
Alternative finance is no longer a dirty word, or “lender of last resort”. It can offer tailored, creative and efficient funding options. The increased competition that alternative finance providers are bringing to the market is undoubtedly a good thing, however the vast array of new lenders, lending options and bespoke products brings its own challenges and potential pitfalls to SME’s.
Trying to work out the best options for your specific circumstances can be a minefield, especially where you no longer have a dedicated Relationship Manger at your Bank. This is where an experienced broker can be essential to support SME’s navigate this new landscape. At South West Business Finance, all our brokers are very experienced ex-bank managers who, as well as being experts in the market, also understand the importance of relationships.
If you would like to discuss your funding structures or business goals, don’t hesitate to get in touch:
☎️ 01225 800849