Alternative Finance Options for SMEs - by Tomer Aboody

Thursday, 22 October 2015
SMEs are a critical part of the UK economy. According to the Department of Business, Innovation and Skills, there are a record 5.4 million private sector businesses operating throughout the UK, with small firms responsible for 48 per cent of all private sector employment, while contributing a massive £1.2 trillion to the economy.

However, the restrictive approach to lending from traditional sources continues and the lack of funding in the market has seen many struggle to finance their businesses.
Business owners need more innovative options, tailored to meet their needs and one such source that has become a critical tool to fund the SME community, is bridging finance.

MTF are committed to providing liquidity to the SME sector- since 2008 we have been delighted to have the opportunity to assist numerous businesses.

There are an array of instances where bridging finance is the ideal solution for companies needing quick access to funds or to plug a gap that traditional lenders are unable to fill. Whether funds are needed to acquire stock, to facilitate a new venture or provide additional capital to stimulate growth.

For example, shareholders of a national brand of health food products needed cash to inject into their growing business. With a large amount of retail distributors, the applicants faced a lag time between sales and booking a profit.

Despite being a large and growing business behind a major household brand, they were unable to obtain the additional funds they needed from banks. MTF were able to provide a £626,000 short-term loan in under a week, satisfying their liquidity needs.

Specialist finance lenders have worked to support the underfunded SME sector.
Today there are a whole range of non-bank funding solutions successfully lending to small businesses. According to the latest results from NACFB, small business lending via NACFB members rose by 31% to £15.98bn in the last 12 months.

It has never been more important for business owners to gain a broad familiarity with the full range of financial tools available to them. At MTF we welcome second charge applications and are actively looking to provide liquidity to the SME sector.