Wednesday, January 23, 2013

Invoice finance makes mark in construction industry | Business ...

Building firms and property developers may still be struggling to secure business finance from banks, but an increasing number of companies are looking to invoice discounting and invoice factoring in order to raise funds.

Wilkins Kennedy, an accounting firm, has conducted research that shows how invoice finance increased by 17% last year ? from 1,629 companies raising funds in 2011 to 1,911 in 2012.

The latest data from the Bank of England reveals that issues with being given credit from banks has led to borrowing in the construction industry falling to only ?20bn.

Wilkins Kennedy Head of Property, Nick Parrett, said of the research findings:

?The construction industry has been badly hurt by the reluctance of banks to lend to even the most solvent businesses in this sector.?

He said that the banks were deterred from negative experiences, which means that construction companies are left with seeking alternative finance options.

The company?s numbers from invoice financing showed that this method of raising finance has grown since 2007 by 65%.

Business level numbers from last year released by the National Association of Commercial Finance Brokers confirmed that business finance has proven difficult to access when it comes to traditional lenders, but that alternative finance providers are filling the gap.

The numbers show that there was a ride of more than 4% of commercial finance overall by its 83 lending members.

The asset finance and lending sector grew by an impressive 100%, having been lent the most by lender members of the NACFB.

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Source: http://www.psfinance.co.uk/invoice-finance-makes-mark-in-construction-industry-1753.html

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