Although a potential end to the recession may be in sight[1], times could remain stormy for UK businesses for some time according to the CBI[2]. With that in mind, leading independent financier Bibby Financial Services is urging businesses to consider their cashflow options now to ensure they have the opportunity to grow once the financial forecast improves somewhat.
Indeed, with the CBI also claiming company inward investment is down 12.4 per cent on last year, yet an expected economic recovery due next year, the provision of cash flow now for small and medium-sized businesses could mean make or break for some firms.
Edward Rimmer, Bibby Financial Services chief executive, UK and Ireland, said: ìFor those businesses wanting to make a change in order to improve their cash flow and be able to make investments moving forward, alternative finance, and in particular invoice finance, is a really viable option. By releasing cash tied up in invoices, firms are able to meet creditor payments such as PAYE and taxes, as well as the more obvious payments to suppliers and of course be able to foot the wage bill.î
ìHowever, with latest figures from the Finance and Leasing Association (FLA) showing a 12 per cent reduction in overall new consumer lending in March 2009 compared to the same month in 2008, credit terms are still clearly tight for most borrowers.î
ìSo, having an invoice finance facility in place will provide security of cash flow and the appropriate level of funding in order that when the time comes to make an investment in their business, those owners and managers who have fortified their finances will reap the rewards and make the most of the predicted growth next year.î
[1] National Institute of Economic and Social Research (Niesr)
[2] Economic & Business Outlook, CBI, June 2009
Cash flow key to unlock UK business investment
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