Unsecured Business Loans
Unsecured Business Loans can be used by SME to fund stock, refurbishment, business expansion, pay taxes, professional indemnity insurance, product development, buy plant & machinery etc. These loans can be over term from 6 months to 5 years term. Rates can be from 6% with potentially no early repayment penalty. A business can borrow from £5K up to £150K. We work with Lenders who can offer this facility.
(Facility available to SME’s across UK including N.Ireland)
Invoice Finance is a form of short-term borrowing often used to improve a company's working capital and cash flow position. It’s also known as Invoice Discounting/Receivable Finance/Sales Finance/Sales Ledger Finance & Debtor Finance.
Invoice Finance allows a business to draw money against its sales invoices before the customer has actually paid. To do this, the business borrows a percentage (between 50% - 100% depending upon the business sector) of the value of its sales ledger from a merchant bank/finance company, effectively using the unpaid sales invoices as collateral for the borrowing. The result is the business gets cash from its sales invoices earlier than it otherwise would.
It can now be offered on a single invoice basis via specialist lenders.
Invoice finance arrangement can be totally confidential, so that customers and suppliers are unaware that the business is borrowing against sales invoices before payment is received. Invoice Finance facility can also be protected against bad debts.
Factoring is also a form of short-term borrowing often used to improve a company's working capital and cash flow position. It’s also known as Invoice Factoring/Receivable Finance/Sales Finance/Sales Ledger Finance & Debtor Finance.
It operates exactly as an invoice finance facility, the only difference being that debt/sales invoices are collected from the customer by the internal credit control team of a merchant bank/finance company. Factoring can be particularly suitable for businesses that either do not have a credit control staff or wish to outsource it a third party.
Factoring finance arrangement can be totally confidential, so that customers and suppliers are unaware that the business is borrowing against sales invoices before payment is received. Factoring Finance facility can also be protected against bad debts.
Trade Finance is basically related to UK as well as International Trade Transactions. A merchant bank /boutique trade financier can fund a business’s supply chain when a traditional bank may not be able to fund a trade transaction. The trade financier may purchase goods simply on the back of a confirmed purchase order without relying on the assets within the balance sheet as collateral. Trade Finance can be used to bring goods into UK & Europe. These can be cloths, home wares, giftware, electrical appliances etc, provided they are finished goods.
Trade finance can also be used to fund exports out of the UK. International trade may not necessarily mean bringing goods via UK and hence there are no reasons why a UK based trade financier can’t fund trades that do not enter the UK at all. Trade finance can include Documentary Credit, Trade Credit Insurance, Factoring or Forfaiting.
Supplier Finance or Supply Chain Finance allows a supplier to sell their invoices to a merchant bank at a discount as soon as they are approved by the buyer. This facility assists the buyer to pay later and the supplier to have early payment of his money. Instead of relying on the creditworthiness of the supplier, the bank deals with the buyer – usually a less risky prospect.
Supply chain finance is an excellent facility as it allows both the buying company and the supplier to improve their working capital.
Stock Finance or inventory finance allows a business to raise working capital against the stock owned by the business. It can be set-up as a stand-alone facility or can be bolted onto invoice finance or factoring finance. A merchant bank will use a third party stock valuation to be carried out to arrange a stock finance facility, then they can advance up to 50% of valued stock as working capital facility. It is a flexible facility as it will grow with the changing stock levels.
Asset Finance is a very valuable alternative to conventional bank loans to improve the cash flow of a business. Secured against the asset being financed, reducing the requirement for additional collateral. The finance cannot be recalled during the life of the agreement. It is flexible finance option as it allows replacing or updating equipment at the end of the lease period. This type of finance can be extremely useful for a business, who are looking to acquire an asset (plant & machinery etc) can use this facility in acquiring the assets rather than part from large chunks of cash.
There are many types of contracts available to suit most business needs. The tax treatment of most assets purchased/hired via asset finance is very favorable as the interest paid and annual depreciation is generally treated as business expense. The VAT paid can generally be claimed back depending upon individual business circumstances.
Vendor Finance is a facility that can be offered to customers allowing them to buy your products and services by offering finance via a third party Lender/merchant bank. The advantages of offering equipment finance to your customers are numerous. By offering vendor finance facility you will offer total sales solution. A business will experience increased sales, close sales faster, reduce debtor days, improve cash flow, increased customer loyalty as your customers will be able to update/replace their old/obsolete equipment.
Merchant Cash Advance
Merchant Cash Advance companies provide funds to businesses in exchange for a percentage of the businesses daily credit/debit card income. The Merchant Cash Advances are not loans - they are a sale of a portion of future credit and/or debit card sales. Merchant Cash Financier will advance money based on your monthly credit and debit card sales and can typically advance up to 85% of your monthly average. The cash Advance will get repaid as you take payments from your customers. This can be a small agreed percentage (between 5-18%) of each future credit and debit card sale you take from your customers. In order to qualify for this facility, a monthly minimum credit/debit card turnover of £3,500 is required plus being in business for more than 1 year.
Business Start-up Finance
Business Start-up Finance having worked with numerous entrepreneurial businesses, we recognise how challenging it can be to raise money to start and grow a small business. The task of securing an appropriate investment partner is an extremely difficult and slow process that can be a struggle at the best of times. In today’s economic climate this has become even more challenging.
We work with a number of investors and business angels and start-up business finance specialist firms that can help entrepreneurs with their business opportunity.
Private Equity is made up of investors and funds that would invest directly into private companies. Capital for private equity is raised from retail and institutional investors, and can be used to fund new technologies, expand working capital within an owned company, make acquisitions, or to strengthen a business’s balance sheet.
The majority of private equity consists of institutional investors and accredited investors who can commit large sums of money for long periods of time. Private equity investments often demand long holding periods to allow for a turnaround of a distressed company or a liquidity event such as an IPO or sale to a public company.
Venture Capital is private funding used to support new businesses and speculative ventures, usually businesses with high growth potential. A typical venture capital investment usually involves the business owner giving up equity to the venture capitalist firm in return for funding. A strong business plan and the possibility of better-than-average returns are usually key attributes required in the decision of a venture capital firm to fund a business start-up. This is a very important source of funding for start-ups that do not have access to capital markets. Venture capital can also include managerial and technical expertise. This form of raising capital is popular among new companies or ventures with limited operating history, which cannot raise funds by issuing debt. We work with a number of venture capitalist firms in various business sectors.
MBO Finance is a transaction where a company’s management team purchases the assets and operations of the business they manage. A management buyout (MBO) is appealing to professional managers because of the greater potential rewards from being owners of the business rather than employees. MBOs are favoured exit strategies for SME’s who wish to pursue where the owners wish to retire. The financing required for an MBO is often quite substantial, and is usually a combination of debt and equity that is derived from the buyers, financiers and sometimes the seller. We have involved in several MBO and can assist with financing such a transaction.