Kickstarting this week’s Business Finance Bulletin, the Recovery Loan Scheme has had a quiet start since its launch but the number of lenders on the panel is now slowly increasing. We look at the latest additions and what continues to hold the Scheme back.

The Start Up Loan Company is encouraging younger people to think about becoming entrepreneurs. This is off the back of an analysis of the 80,000 loans they have distributed which reveals a large portion have gone to new business owners in the 18 to 24 year old age range. How could the loan assist you?

To close, a look at findings from the latest Lloyds Bank UK Recovery Tracker, which uncovers that the UK’s key sectors are back on the path to growth.

If you would prefer to listen to the podcast version you can click below or download to listen to later via our Soundcloud, Google, Spotify, Stitcher or itunes channel.

If you prefer to read about this week’s news, here’s a transcript of the content…

More lenders offering the Recovery Loan Scheme; young and budding entrepreneurs encouraged to look at a startup loan; and key UK sectors of back on the growth trajectory. All of this in the latest Business Finance Bulletin.

Recovery Loan Scheme Lenders

The Recovery Loan Scheme launched on the 6th of April, and there hasn’t been an awful lot of noise in the marketplace as regards how successful or otherwise that it’s been. Before we take a look at why this is, let’s remind ourselves quickly of the key features of the Recovery Loan Scheme.

It’s designed to help promote growth, so if you’re looking for additional working capital or cash; buying plants and equipment and machinery, then this is the loan for you. If you don’t want to provide a personal guarantee, you can borrow up to a maximum of £250,000 with no personal guarantee. If you’d want to borrow more than your guarantee would be limited to 20% of the balance.

The interest rate is capped at 14.99% and in terms of the loan term, it depends on the type of product you take be it would be a maximum of three years or a maximum of six years.

Demand at the moment, is still a bit muted and it’s all down to the makeup of the panel. During the early days, it was really only the high street banks and a few other niche players but over the last couple of weeks, we’ve started now to see lenders coming on to the scheme, having applied for and being accredited by the British Business Bank.

The panel, as I record this, now stands at 27 lenders and the recent additions include Triodos bank, Atom bank and Synergy bank, so we’re starting to see some activity coming through.

However, one thing to bear in mind is that the appetite to support is going to be quite varied. The high street banks, well they’re probably going to be quite tough. The other ones are focusing on particular products, but also some of them are being very careful by saying it’s open for only existing customers.

Some of them are saying you have to provide security, which is a bit strange considering the government’s giving an 80% guarantee; a bit bizarre.

So you can see the panel is quite tight and there’s going to be reasons for you to really look closely at each of them to see whether it fits your needs.

If you want to know which lenders are on the panel, just go along to the British Business Bank website, which is www.british-business-bank.co.uk.

Alternatively, of course continue watching this Bulletin and periodically I’ll be telling you about all the new lenders who are coming on the Scheme.

Start Up Loans for Young Entrepreneurs

In the pandemic, one sector of society that has been hit particularly badly are the millennials. These are the 18 to 24 year olds who’ve been hit hardest when it comes to unemployment with them taking the brunt of job losses.

Well, the Start Up Loan Companies, is launching a campaign to encourage these 18 to 24 year olds to not necessarily think about getting a job, but perhaps to think about starting a business.

If you are starting a business, of course, some startup capital will always help and that’s where the Start Up Loan Company comes in.

Since it’s been going since 2012, of the 80,000 successful loan applicants they had, 54% of them have been unemployed and of all of that 54%, 31% of them were 18 to 24 year olds.

Now, interestingly, over the last year, the number of people applying for this in the 18 to 24 year old range range has doubled compared to 2019. So we can see there’s a lot of interest from young people in terms of starting a business. And this is what the startup loan company is hoping to tap into.

If you are in that age bracket and you’re looking to start a business, check out startup loans, it’s a great product.

If there’s four of you, each of you can have a maximum of £25,000, or if you’re on your own, it’s a maximum of £25,000. The interest rate is 6% and you can pay the loan back over five years. Great interest rates and a great loan term.

If you want to know more, just go along to their website, which is www.startuploans.co.uk

Back on the Growth Path

According to the latest Lloyd’s bank UK Recovery Tracker, all the key sectors in the UK economy are starting to look at growth again.

Their latest report for April highlights that of the 14 sectors they regularly monitor, all 14 of them reported positive growth output in the month of April. Now that is the first time since August, 2018, that all 14 sectors have recorded growth. In March it was 11 sectors recording growth. So you can see there’s now been a further increase, which is great news for the economy.

Which sectors are leading the pack? Well it’s manufacturing and also technology. Those are the ones that grew by the largest amount.

However, what is even more encouraging that 13 of the 14 sectors though have reported growth plans over the next 12 months, which is going to exceed that recorded by their global counterparts. So it does appear that UK entrepreneurs and business owners are feeling a lot more optimistic and a lot more bullish than their overseas competitors.

Overall really good news for the UK economy, which means that hopefully we’ll finish 2021 with some very strong figures.

Wrap Up

Well, that’s it for another Bulletin and as ever, I hope you enjoyed watching it, and if you did please don’t forget to subscribe to this channel or hit the like and share button.

I look forward to being with you again, next time.

We open our latest Business Finance Bulletin with the good news that business confidence levels are on the up. The latest Business Barometer report from Hitachi Capital Business Finance reveals that an increasing number of business owners are predicting improved months ahead.

Cashflow can be tight for many businesses, but particularly for start ups. Just Cashflow, the short term finance lender, has announced that alongside their new Business Account, qualifying start ups can now access their Revolving Credit Facility.

To wrap up this Bulletin, we review the latest company insolvency figures which highlight that businesses potentially in trouble continue to be protected by the various government support schemes.

If you would prefer to listen to the podcast version you can click below or download to listen to later via our Soundcloud, Google, Spotify, Stitcher or itunes channel.

You can read the transcript of this Bulletin below…

Business confidence is starting to return; the short-term lender Just cashflow extends supports to startups; and company insolvencies still remain low. All of this in the latest Business Finance Bulletin.

Business Finance Confidence

Let’s opened this bulletin with some good news. Hitachi Capital Business Finance, as part of their quarterly Business Barometer series, have spoken to approximately 1,300 small business owners and the resounding message is that confidence is beginning to return to the marketplace.
Let’s have a look at those businesses who say that they are predicting growth.

Well, three months ago, 26% of businesses said that they were predicting growth for their business.

Forward three months to today, that figure now stands at 36% of business owners saying that they are planning growth over the coming months. That’s a quite a big increase and that’s a big vote of confidence for the UK economy.

Let’s look at the flip side of businesses who were fearing collapse. Well, 12 months ago, the survey found that 29% of small business owners said that they were fearful that their businesses would not survive.

Now, 12 months later, that figure stands at just 7%. That’s a significant fall and just shows how much confidence is now starting to come back into the market place. But of course, it’s not all plain sailing.

I just want to make you aware of one key thing to look out for and that is growth brings its own problems, particularly in terms of cashflow. When you start growing again, particularly if you’re growing rapidly, there’s a big demand on your cash. You need to buy in stock. You need perhaps to fund the growing debtor book, all of this needs cash.

So do watch that and make sure that you are forecasting your cash flow requirements ahead to make sure that you don’t run out of funds, but overall, a really good vote of confidence for the UK economy.

Just Cashflow Supports Start Ups

Are you planning to start up a new business or you have recently started one? I’m sure you’ll agree that the one thing that can hold you back is cash or more particularly cashflow.

Poor cashflow can be a killer for any business, but for startups in particular it can be very challenging.

The short-term finance provider Just Cashflow has announced, it is now going to support qualifying startups by giving them access to their Revolving Credit Facility, which is a facility up to the amount of £10,000. This sits alongside their newly launched business account which is available via a mobile phone or a desktop app. And it does all of the things that a traditional bank account will do. You can make payments online, both in and out. You have a master debit card as well. It integrates with various software accounting packages.

So it really is a good alternative to your main high street banks and particularly of interest of course to startups, where you may be able to access this Revolving Credit Facility up to £10,000. This facility acts essentially like an overdraft limit where often times when you need to make payments out, but you haven’t got the cash in from your clients yet; it acts like a bridge between cash in and cash out a really useful facility for startups.

If you want to know more about the Revolving Credit Facility and also the new business account, just go along to the just cashflow website, which is www.just-cashflow.com. A great new service by Just Cashflow and good to see that people are out there supporting new start ups.

Company Insolvencies

Let’s take our usual monthly look at company insolvency figures. That’s a bit of a depressing topic, of course, but it’s really important that you watch this, particularly if you provide credit to your customers, by giving them 30, 60, 90 days before paying you. You really need to watch the trends going out there to make sure you don’t get caught out.

The figures as I’ve reported in previous bulletins continue to be very low, which is puzzling compared to where UK economy is at the moment in terms of the stresses out there. The latest figures have been released by the Insolvency Service for March, 2021. And in that month, they were 992 firms that went into some form of insolvency arrangement. Now compared to March, 2020, that is down 20%. And that’s the puzzle. You’ve got lots of stresses in the economy, and yet a lower number of businesses are entering into insolvency compared to March, 2020.

If you wind it back a further 12 months to March, 2019, this figure is down a further 37%. So again, a very large drop in the number of businesses going into insolvency.

But of course, the reason behind this is the level of government support, via bounce backs and the CBILs loans that were given; the furlough or the various grants. But we know all of that is now coming to an end or has come to an end. The distresses will now start to come through.

The other thing of course is the perils that come with growth. And I mentioned in the first segment, you’ve got to watch out when you grow your businesses; growth brings an increased demand for cash. And if you can’t access that, then you may get into trouble. So if you are providing credit, just keep an eye on those firms, making sure that they are financially sound.

Also if you are one of the businesses suffering financially, make sure that you take the appropriate advice. Go speak to your financial advisor, your accountant, or seek out a licensed insolvency practitioner in order to make sure that you seek out the correct advice.

Close

That’s it for this Bulletin. As ever, I hope you liked it and if you did, please, don’t forget to give it a like, a share and of course, subscribe to this channel.

So that’s it and I look forward to being with you next time In the meantime, have a profitable, successful and safe week.

Start ups have traditionally found it challenging to raise finance. To open this week’s Bulletin, a look at how Just Cashflow will be using Augmented Intelligence to pre-select and directly approach start-ups worthy of financial support.

The latest annual Small Business Finance Markets Report from the British Business Bank reveals how banks are getting left behind in terms of financing SMEs. Are the days of High Street being the first port of call numbered?

Wrapping up this edition, a look at recommendations from the Money Advice Trust, which runs Business Debtline, on how the continuing problem of late payment needs to be addressed.

If you would prefer to listen to the podcast version you can click below or download to listen to later via our Soundcloud, Spotify, Stitcher or itunes channel.

Start ups can find it challenging to raise finance but since 2012 the Start Up Loans Company has filled the gap. We open our latest Bulletin by looking at a new milestone they have reached in terms of loans disbursed to start up businesses.

The government continues to ramp up its focus on tackling the late payment scourge. New measures have been announced by the Small Business Minister to curb the ability of larger businesses to misuse their power when it comes to money owed to small businesses.

To close, a look at the annual Working Capital Index survey from Lloyds Bank which reveals that businesses are continuing to hold onto growing levels of excess working capital. We ask why this should be of concern.

If you would prefer to listen to the podcast version you can click below or download to listen to later via our Soundcloud, Spotify, Stitcher or itunes channel.

According to the Registry Trust, 2017 saw a significant jump in the number of County Court Judgments registered. Is this a sign of toughening economic conditions or businesses being more aggressive when it comes to tackling overdue payments?

Since its launch in January, Open Banking has been gathering support primarily amongst the smaller, so called Challenger Banks. The latest bank to embrace Open Banking is mobile-only Starling Bank. It has announced a tie-up with TrueLayer which will act as a link between Starling Bank customers and alternative finance providers.

One of the more challenging aspects of starting a business is arranging finance. Where do you go? That’s a question posed by Hitachi Capital Business Finance when it spoke to start ups and younger businesses. We take a look at where business owners are getting their money from.

If you would prefer to listen to the podcast version you can click below or download to listen to later via our Soundcloud, Stitcher or itunes channel.

We’re delighted to bring you another guest blog from Innovate UK on funding for start ups…

Pooling together the cash you need for your start-up can feel like an almost impossible endeavour, no matter where you’re currently sat in the funding cycle.

You’ll need investment to sustain the longevity of your business – it’s a core part of genuine development and expansion. Appealing to investors and grabbing the funding you need should be a top priority.

With that in mind, we’ve compiled together a list of tricks and tips to help you make the most of your resources and optimise your efforts.
Trying to target potential backers? Or are you just curious as to what’s best for your business? Either way, we’ve got all you need to know down below with our tips to start-up funding.

Outlining Which Funding Stage You’re In

The first step you’ll want to take is evaluating your start up. You’ll need to determine where in the funding cycle you’re currently settled.

Ask key questions about the progress of your business. Are you earning profits from your services and is your product far along in development? Having an awareness of your position will help direct you toward the types of funding you should be pitching for.

Establishing self-reflection with regards to your funding stage is crucial. Those seeking to invest in your vision will want to see an understanding of your own business.

Explain Your Reasons for Funding

You’ll need to understand thoroughly each stage and all of the different requirements they entail. The amount of funding you ask for will need to be appropriate and realistic in relation to your targets and business goals.

Investors will want to see proof of concise, obvious needs for their money. Show them where their funding will be used and how you’ll be making the most of it. Demonstrating a strong pitch and clear direction will make obvious your confidence and personality.

Get to Know Your Target Investors

Investigate those likely to fund your start-up and get to know your target investors.

Being aware of general behaviours and risk appetites of investors at different stages, and the ways in which they differ, will help increase your chances of success. Get clued up, extensively research and familiarise yourself!

More knowledge on who will be looking at your start-up allows for a better grasp on which approach to take. You’ll know how you’re perceived by those that matter and you can adapt accordingly.

Be sure to know your financial needs, business milestones and current progress reports, as these will influence the types of investors you’ll garner interest from. Be conscious of the types you’re appealing to, what’s suitable and what you’re actually asking for.

If you misjudge, it may hinder your efforts!

Timing is Crucial

Monitor your start-up closely and determine which areas need expansion. Find out what you need to do and where in order to move into the next funding stage, as this will make clear the best time to make your pitch to investors.

Successful timing will allow your long-term goals to be met in a sustainable way. You’ll avoid falling short later when new backers
become interested. With sustainable growth, you’ll be able to keep moving from positive to positive long-term!

In need of some more guidance when it comes to business ventures and all things start-up? Be sure to follow Innovate UK on Twitter and subscribe to our YouTube channel for the latest news, tips and advice.

Getting finance for a start up business has always been tough but with the Start Up Loans Company, the pain has been eased. In this Bulletin, looking back on the loans they made in 2016, which UK start up hotspot cities have taken advantage of the loans available?

Different methods of calculating interest rates can make comparing finance options a challenge. We take a look at a new online tool from short term lender Fleximize, which can help you compare finance offers on a like-for-like basis.

The latest SME Confidence Tracker survey from Bibby Financial Services reveals the top three challenges facing UK manufacturers. The top slot is taken by concern about rising prices but other constraints are also weighing heavy on the minds of UK SMEs.

If you would prefer to listen to the podcast version you can click below or download to listen to later via our Soundcloud, Stitcher or itunes channel.

We start off this week’s Bulletin with the question of how many people who had a dream to run their own business actually took the step and if they didn’t, what was stopping them. Turning to more established businesses we look at findings from a recent report, DNA of an Entrepreneur, on how business owners view their current and future prospects.

The government has been keen to stimulate competition in the banking sector and three years ago a current account switching service was launched to make it easier for individuals and small businesses to move banks. Three years on, how has it performed?

Supermarkets can sell most things we need but who would have thought they would enter the crowdfunding market? That’s what has happened with the launch of a crowdfunding platform by Tescos focused on helping food and drink manufacturers raise finance.

If you would prefer to listen to the podcast version you can click below or download to listen to later via our Soundcloud, Stitcher or itunes channel.

To start off this Business Finance Bulletin we take a look at a new milestone achieved by the Start Up Loans Company in terms of the volume of loans disbursed. However, the question is being asked as to how much this government scheme has lost in the form of written-off loans and those that have fallen into default.

According to latest figures from the Asset Based Finance Association this sector, which covers invoice discounting and asset finance, has also reached new heights with a record amount of business being written in the 12 months to June.

What about business confidence post the Brexit vote? We take a look at how business owners are feeling about their prospects and what you should do now in case the mood changes.

If you would prefer to listen to the podcast version you can click below or download to listen to later via our Soundcloud, Stitcher or itunes channel.

In the latest episode of the Business Finance Bulletin Rob Warlow looks at a report from Liberis, a finance provider, on the issues growing businesses face particularly in terms of late payment and how you can avoid it.

The Seed Enterprise Investment Scheme is a little known scheme devised to help both start ups and investors make use of attractive tax breaks. Rob shares findings from a review as to how popular the scheme is and looks at the SEIS eligibility criteria.

Turning to crowdfunding, Rob has news from the Centre for Economics and Business Research which predicts that the amount of money accessed through crowdfunding will grow to a significant sum by 2020.

If you’re a VAT registered business you are probably familiar with the challenges of meeting the quarterly demand! Recent figures from finance provider LDF show a large amount of overdue VAT is outstanding to HMRC and in the Business Finance Tip of the Week Rob chats with Liz Maher from Centurion VAT in which she shares tips on managing your VAT risk.

If you prefer to listen via a podcast version you can download via our Soundcloud or itunes channel or listen in below.