Access to Finance: Businesses urged to understand alternatives

BETTER understanding of the alternatives available can help businesses secure the finance they need.

That’s one of the key pieces of advice from experts in the new Access to Finance supplement published by TheBusinessDesk.com in association with Barclays Corporate.

In addition to business loans and overdrafts, firms can access a variety of products including trade, invoice and asset finance.

One of the key mistakes made by businesses is to mismatch their requirements with the finance they are asking for which is where advisers can play an important role in helping directors and shareholders take a more strategic approach.

Experts in the supplement also reveal how the credit crunch has affected the way finance providers consider requests and the security they are looking for.

Banks are more likely to see cash flow as a deciding factor in a loan request rather than property values, for example, and there has also been a move away from overdrafts.

Jim Sparling, corporate director for Barclays Corporate, said: “We are being more structured because an overdraft could be – and more than occassionally has been in recent years – used for anything, where accepted thinking would note that it should not be used for capital purchases, for example.

“But with a structured product, because it is controlled, the cost of capital is lower and that can be reflected in better pricing and allow more availability of finance.”

Click here to download the free Access to Finance supplement.