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Venture Finance urges industry to drop 'alternative' tag
The white paper outlines how a consensus was reached during the discussion that Invoice and Asset Based Lending is already a mainstream funding option for UK businesses. The 'alternative' tag grew during the 1990s, as the industry began to gain greater recognition as a credible option for companies looking to fund business change - from growth to buyout or turnaround.
Those at the think tank argued that the ability of Invoice and Asset Based Lending to support today's business needs means that terms like 'alternative' are now misleading and are holding the industry back from fulfilling its potential in the new financial landscape.
Peter Ewen, Managing Director, Venture Finance explains: "As an industry, we have often classified ourselves as 'alternative' finance. In the past it has been a useful point of difference, highlighting its flexible and progressive 'can-do' attitude compared with the "one solution fits all" philosophy of traditional finance.
"However many businesses' bad experiences with traditional lenders during the recession underline Invoice and Asset Based Lending's back to basics approach which is grounded in common sense, not driven by credit. The last few years has seen a financial shift from irresponsible lending to a risk adverse drought but our industry has always taken the centre ground - being dynamically linked to sales performance and existing assets".
Chaired by Professor Nigel Waite, head of the Financial Services Research Forum, the 'Evolution of Alternative Finance' think tank drew together industry representatives including the Asset Based Finance Association (ABFA), KPMG, the Federation of Small Businesses (FSB), the South East England Development Association (SEEDA), a successful retail business as well as relevant media and research bodies.
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