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More than a quarter of UK firms claim that banks won’t lend to them

A new study reveals the challenges that businesses experience when trying to obtain financing from traditional lenders and how non-traditional alternatives might fill the gap.

According to a poll conducted by the Confederation of British Industry (CBI), more than a quarter of business executives said they had trouble obtaining financing from major banks. Additionally, 2 out of 5 people believe that banks’ lending practices have not evolved to meet contemporary company demands.

More than one-third of the firms polled believe alternative lenders make it simpler to acquire capital, and three-quarters say their company has profited considerably from invoice financing options. Faster transactions and business processes are cited by almost two-thirds of respondents as two major benefits of adopting non-traditional sources of funding.

However, in the last 12 months, just 5% of small and medium-sized enterprises have used invoice financing from an alternative lender. Non-traditional sources of finance may certainly play a part in enhancing the services offered to businesses, but few do so.

Being able to obtain funding quickly is crucial as the cost-of-living problem continues to have an impact on companies throughout the nation. This is even more true when it comes to payroll, especially for contract worker compensation. It was found that 27% of organisations acknowledged paying contract employees after more than 90 days had passed, which is not a workable operational model.

Banks and other traditional lenders cannot meet modern enterprises’ demands because they lack the flexibility, scalability, and speed necessary to do so. Company owners all around the nation find it difficult to obtain financing through conventional channels.

Alternative financing is ideally suited to close this gap and throw a lifeline to business owners. Businesses should weigh all their alternatives now that a rate increase is imminent and decide what would be best for the company overall.

Recruiters, consultancies, and employment marketplaces may now concentrate on expanding their businesses both domestically and abroad thanks to flexible finance and a customised technological platform. 

By integrating Apollo’s invoice finance solution, funds and resources are made available, allowing businesses to invest in hiring new employees more efficiently.