FINANCE
How asset finance can assist small businesses
Award-winning niche bank Cambridge & Counties Bank looks at the potential benefits of asset finance to SMEs.
Shopping around for personal finance deals is just a few keyboard strikes and mouse clicks away. Best Buy tables and comparison websites make quick work of assessing the relative merits of the many choices. When it comes to business finance, however, the
Best Buy tables are less heralded, and with good reason, as businesses have every motive for considering lenders not among the best buys which are simply ranked on headline interest rates. Business deposit accounts and bonds can and are
ranked by rate, but the ease of the application process and the service levels available make the decision more nuanced for businesses. And when it comes to borrowing money, the rates in the market are
even harder to line up for comparison. Niche banks such as Cambridge &
Counties are flexible and innovative sources of property lending, bridging
loans or asset finance that are not driven by volume of deals secured
Asset finance is still an untapped opportunity for many SMEs
through eye-catching interest rates. Cambridge & Counties Bank
launched in 2012 with just 12 people and successfully lends to SMEs because it is an SME too.
Take asset finance, which Cambridge & Counties launched just two years ago. Winner of the New Challenger of the Year for 2016 in the Leasing World Awards, Cambridge & Counties Bank is forecasting growth in asset finance. For many businesses, asset finance is still an
unrealised opportunity. New research from Cambridge & Counties found only 29% of business owners said their firm had used asset finance to better manage cash flow. Fewer (26%) said they were planning on using asset finance over the next 12 months. That’s despite only around one in ten (11%)
describing the strength of their firm’s working capital facilities as ‘very strong’ even though the business is doing well. More (12%) said it was ‘weak’. Of those businesses that had used asset finance over
the past five years, the primary reason was to purchase new plant or equipment while protecting their cash flows. Being unable to extend an overdraft was a reason for 15%. The bank lends on traditional assets such as plant
and machinery, commercial vehicles, yellow goods, cars, materials handling and construction equipment. It expects its products to evolve and to add new partnerships to its broker network and it also welcomes direct customers.
60 business network December 2017/January 2018
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