A new survey discovered that 85% of business owners asked said that they did not trust traditional lenders.
The survey by Hitachi Capital Invoice Finance questioned 502 business owners. Of those asked, 67% had borrowed money in the last year, even though 35% said that they tried to avoid borrowing money.
Around 20% of business owners said that one of their main worries was cash flow and many were struggling to maintain a healthy cash flow.
Andy Dodd, the managing director of Hitachi Capital Invoice finance, said that it was important for business owners to be aware of the many sources of finance available to them. He said:
“There are a number of options available to help prioritise overdue payments and maintain financial resource, particularly outside traditional lenders.”
He noted that many business owners questioned in the survey were cautious about borrowing money, and this could restrict their growth.
Among the many alternative banks that businesses can use are bridging loan lenders that provide short-term loans. A bridging loan, for example, can be used to provide finance that helps a business get through a period of temporary cash flow. Low cash flow can be caused by delays in receiving payment for outstanding invoices. Some businesses have seasonal periods when business is slow. Both these situations are temporary and can be helped by short-term finance. The bridging loan can be repaid after the invoices have been paid, or when business picks up after the slow season is over.