Expert View


by Matt Robinson Rosebud fund manager

Given the take up of the government backed loan schemes, it seems timely to write about the importance of managing your lender.

This will be new to some, who have neither wanted nor needed debt before, but have been left with no other option in order to survive.

Financially speaking, lenders are often the biggest investor in your business. As such, they should be viewed and treated as a priority stakeholder, but that isn’t always the case.

Effective, honest, two-way communication is vital. As payment holidays come to an end,  conversations are on the horizon for many.

Ask for help if you need it. Do it early. Often people will bury their head in the sand,

hoping the problem will go away, and when it comes out it’s too late to act.

Most lenders will require you to provide them with management information on a regular basis. If this is the case, do your best to provide useful, easily digestible information in a timely fashion.

 further and add your own commentary regarding performance. This dialogue can lead to healthy, proactive conversations about what help and support is available.

It’s understandable that some businesses are wary of their lenders, as they may have endured negative experiences or read stories in the press.

However, these days, there is a concerted focus, by lenders and the regulators, to treat customers fairly and do the right thing.

needs to understand that and your plans to address the issue.

“It’s too easy to say ‘my banker doesn’t understand my business’ but it’s a two-way relationship and you need to help them so they can support you. It’s all about an open, honest dialogue.”

Andy Traynor is based at FW Capital’s Preston  SMEs in Lancashire and Cumbria from the £102m NPIF Debt Finance Fund.

Andy Traynor

He adds: “Communication is also critical. No banker likes surprises, especially if it’s bad news. It’s important to keep them informed.

 isn’t what you expected and your banker

He says: “Businesses should be refreshing and revising their business plans: assessing new risks based on what is now known but may not have been known when they took out their original loan.

 to ensure that capital repayments can be made.”

What they shouldn’t be doing, he stresses is “burying their head in the sand.” Banks and

funders should be able to offer more support if needed, he adds.

“There may have been further effects of Covid since the original loan was taken out, for example the length of time the business has   necessary as a result of this.”

Sam Roden, HSBC business banking area director for Lancashire and Greater Manchester, also stresses the communication issue. He says: “Keep your bank updated on your performance, and let them know in advance if you think you’re going to have a 

“The earlier you discuss potential issues with your lender the more they will be able to do to help you.”

He adds: “For many businesses 2020 will be  from a bank or other lender. For others it   monitoring their performance.

“For businesses that were already highly geared, additional Covid support may mean that the bank has concerns, and that their accounts will be subject to close monitoring.”

Clitheroe-based software company YUDU secured a £300,000 loan from Rosebud, a fund managed by GC Business Finance, last August 

GC Business Finance also delivered a £100,000 loan under the CBILS support scheme.

Richard Stephenson, chief executive at YUDU, says businesses need to know and understand  absolute transparency with the people who are lending you money.

“Agree the reporting system from the start.   detail and to check it was the right format and the information they wanted to see.

“Once that is agreed, stick to the format. Consistency is really important.” He adds that businesses should not wait until they are at “the cliff edge” before raising the alarm. “You are not going to get help if trust is breaking down. Have the conversations early.”




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