Asset Based Finance Association

Small Business Asset Financing Hits Record High

Small Business Asset Financing Hits Record High

The amount of finance raised by UK small businesses borrowing against ‘hard assets’ has risen 7% in a year to hit £3.63bn – a record high – according to a report by the Asset Based Finance Association (ABFA). The survey reports a shift in the way businesses are seeking to obtain finance, with enterprises said to be “turning their backs” on traditional lending and opting to raise cash against inventor, property and machinery instead. UK businesses secured £358m against plant and machinery this year, an increase of 37%  from £261m last year. ABFA has said that businesses are increasingly attracted to the advantages of asset based finance as it’s ‘less risky’ than overdrafts and, therefore, requires banks to hold back less capital for that kind of finance. Jeff Longhur... »

Small Businesses Getting Paid 3 Weeks Later Than Larger Counterparts

Average wait time for small businesses to receive payment rises from 64 days in 2006 to 71 days in 2014 Companies with turnovers of less than £1m wait an average of 71 days to receive payment from customers, whereas businesses with a turnover of over £500m only wait 48 days. Research by the Asset Based Finance Association (ABFA) revealed that although the government has put pressure on larger companies to sign on to the Prompt Payment Code, a voluntary register of companies committed to paying invoices in accordance with contracts; the number of days that small and mid-sized businesses wait to get paid has increased since the recession – rising from 64 days in 2006. The ABFA believe that the increase in payment times is a result of larger businesses using their power over their small busin... »