In this week’s City A.M. feature, our Managing Director Peter Alderson highlights the on-going issue of access to finance for SMEs. Plus, the very first 24/7 online tool lendinghive, enabling businesses to apply for finance, where and whenever they need it.
There is no doubt that consumers have more opportunities to take control of their finances than ever before, with the past five years seeing a rapid proliferation of tools that enable people to access and compare services at the click of a button. Insurance, banking products, car finance options, investment management platforms, and general management of personal financial affairs have all become readily available online.
Until recently, the finance market for small to medium-sized enterprises (SMEs) had lagged behind, but with the development of fintech products for businesses, especially of benefit to smaller firms, this is finally beginning to change.
One area, which has been overlooked in this trend, is asset finance. This method of finance was used for approximately 30 per cent of UK businesses’ investments in equipment last year, but it is still a cumbersome process.
At LDF, we developed lendinghive to fill this gap in the market. Recognising that small business owners often need finance rapidly when under time pressure, lendinghive is the very first online, 24 hour, self-service asset finance tool. It offers access over multiple platforms and a decision in minutes, as opposed to the weeks or months it can take through traditional sources. lendinghive also addresses a desire from small business owners, especially tech-savvy millennials, for technology-driven, digital finance solutions.
While many online solutions exist for loan funding, small business owners in need of finance for equipment were faced with little option but to contact their banks directly or through a broker network, and engage in what could be a lengthy application process. lendinghive provides another option. It is focused on the SME market, especially the micro and small sector; where business owners are heavily involved in the day-to-day running of their companies and simply don’t have the time to go through an onerous application process.
"Small business owners often need finance rapidly
when under time pressure"
This was the situation faced earlier this year by one of our customers, North Wales ice cream parlour Parisella’s. Managing Director and part owner, Joe, was turned down by the bank for funding and needed finance fast in order to meet supplier demand and grow his business. He was able to get a cash injection from lendinghive simply and exactly when he needed it, with a positive impact on his company’s performance. Whereas previously he struggled to finance the operation, turnover is now up 14 per cent compared to last year.
I recently sat on a panel with the Federation of Small Businesses and the Forum of Private Business regarding the challenge of helping small businesses with finance. While two years ago, the debate would have focused on the supply of finance, this has improved significantly. Now the issue is ensuring finance can be delivered to businessmen and women in an efficient and easy to use manner; this is exactly the aim of lendinghive.
To explore the site in more detail, please visit www.lendinghive.co.uk.