Many people think debtor finance is only for smaller businesses that are looking to improve their cash flow. However, the reality is that debtor financing can be used at every stage of a company's development, and is actually growing in popularity among larger companies.
This finding comes from a study by the UK's Asset Based Finance Association (ABFA) into the way companies are using alternative financing measures. The study revealed that almost a third of the total lending in the country is being conducted with businesses with turnover of more than £100 million.
Jeff Longhurst, chief executive of the ABFA, emphasised the broad range of companies that are now looking for alternative financing arrangements.
"We are seeing more and more businesses of all sizes and types taking advantage of invoice finance to fuel their growth, particularly as more traditional forms of lending remain subdued. More businesses are viewing their invoices as what they are - one of their biggest assets," stated Mr Longhurst.
While larger companies are increasingly benefiting from taking on debtor finance, the size of the whole industry has recorded strong growth. According to the ABFA, asset-based financing options have increased by 10 per cent, compared to 2013. Earlier this year, the organisation also recorded the single biggest increase ever, recording 7 per cent growth between March and June.
The flip side of this growth has also been that traditional financing has continued to drop in the UK, down a fifth compared to figures from 2009.
What this study clearly shows is that debtor finance is suitable for every stage of your business's development. No matter how big your ambitions, using a debtor finance solution can ensure your business records strong growth across the board.
If you'd like to learn how Earlypay's Invoice Finance & Equipment Finance can help you boost your working capital to fund growth or keep on top of day-to-day operations of your business, contact Earlypay's helpful team today on 1300 760 205, visit our sign-up form or contact [email protected].