UK businesses have turned to alternative finance in the decade since the recession, with invoice finance and peer-to-peer lending rising by more than £8bn, according to new research.
Asset Based Finance Association (ABFA) data shows a record high of £22.2bn of asset-based finance advanced to businesses at the end of 2016, up from £14.1bn in the beginning of 2007.
Over the same period, outstanding traditional business loans have fallen by eight per cent.
ABFA also found that during 2016, an average of £9.5bn was lent to SMEs using either invoice finance or asset-based lending products.
DTM Legal Partner, Kate Roberts, said: “Previously SMEs struggled to secure bank loans, due to a lack of solid resources to use as collateral, but now there is a wealth of options available, from crowdfunding to invoice trading.
“Being online businesses themselves, finance providers can relate to the value of businesses that exist remotely.”
Asset-based finance has been a lifeline for small businesses but it has now become a driver of growth for businesses of all shapes and sizes providing services beyond what traditional sources can often offer them.
DTM Legal have a wealth of experience acting for alternative finance companies in a range of areas including preparing new and amending existing documentation and loan agreements as well as representing funders in complex insolvency litigation.
Find out how we can help you and contact Kate Roberts on 0151 321 0000 or e-mail kate.roberts@dtmlegal.com.
