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18.9 billion reasons why 2018 is the year of alternative finance

New figures show that invoice finance is worth almost £19 billion in the UK. The importance of alternative finance to SMEs couldn’t be clearer and its role is only set to get larger in 2018.

According to UK Finance, the value of invoice finance was £18.9 billion at the end of Q3 2017, compared with £18.6 billion three months earlier. The growth is eye catching and interestingly, it has led some commentators to directly link the ongoing upturn in invoice finance to an increase in UK GDP.

New data from the British Business Bank offer further evidence of the key position that alternative finance has in the SME funding framework. Under the ENABLE Funding Programme, a new lending facility worth £60 million will be available to small businesses for needs relating to hire purchases, finance leases and refinancing. The capital is available through Simply Asset Finance.

This new figures are a clear indicator of the role invoice finance, asset finance and alternative finance as whole plays with regard to SME funding. The sector goes from strength to strength, having firmly established itself as a mainstream funding option.

And looking ahead, its importance to small business owners is only set to grow. Small businesses already face a raft of policy-related costs, and 2018 is only set to bring add to the pressure as the business sector gets to grips with rapid digitalisation, the advance of technologies such as Bitcoin and Blockchain, and the development of the gig economy.

With the waters surrounding the country’s exit from the European Union becoming even muddier, and the impact of this ongoing uncertainty becoming increasingly clear, accessibility, affordability and flexibility in relation to lending will become even more important for small business owners as they work to raise capital for growth and maintain cashflow.

This is how a small business in the south of England used peer-to-peer lending to raise the capital to purchase new equipment.

If 2017 rubber stamped the status of alternative finance, then the year ahead, with market conditions unlikely to change and raising awareness of the services on offer a key focus, is set to be another of stellar growth.

To find out more about A&T Business Associates services, contact Tony on 01903 602211 or tony@atbusinessassociates.co.uk.

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