Just a month since the Government launched its Bank Referral Scheme and the number of small businesses requesting alternative funding is growing. Funding solutions for businesses unable to receive finance from banks are now more accessible then ever.
The Bank Referral Scheme, which was launched to help businesses unsuccessful with the major banks find finance elsewhere, was introduced as an alternative for some of the many UK SMEs.
The Government scheme involves banks passing on the details of small businesses they have rejected for finance to designated finance platforms.
Companies such as V4Bprofessions can offer competitive funding solutions for businesses turned away by high street lenders. Corporation tax bills or VAT payments can be a costly outlay for companies and spreading the cost over six, 10 or 12 months can ease the cash flow burden.
RBS, Lloyds, HSBC, Barclays, Santander, Clydesdale and Yorkshire Bank, Bank of Ireland, Danske Bank and First Trust Bank, offer access to the finance platforms, with small businesses giving their permission before their details are shared.
The platforms then share details with alternative finance providers and facilitate discussions between the business and any provider who expresses an interest in supplying finance to them.
Mike Conroy, managing director for business finance at banking trade association, the BBA said:
‘Banks are helping SMEs to do what they do best – drive economic growth and create jobs. As the latest SME Finance Monitor showed, eight out of 10 businesses that applied for finance in the past 18 months were given the green light.
‘It is important though that businesses which are unsuccessful in their application for bank finance have access to other sources of funding. Some alternative finance providers may be in a better place to support their plans.
‘The industry is working closely with Government and the referral platforms to ensure the scheme is a success.’
For more information on alternative finance visit www.v4bprofessions.co.uk