Finance director shares his views on the finance options available for businesses in an interview with Kerry Smith.
While many have received government-backed financial support, businesses will soon be expected to start paying back what they owe. Finance options might be few and far between for some business owners. We spoke to commercial finance broker Darren Willoughby of 2XL Commercial Finance to find out what’s happening in lending circles.
Niche What changes have you seen from the banks you work with?
Darren Sadly, we have seen many banks close the door to new customers while they mainly focus on CBILS applications for existing customers. It’s meant that people looking for standard non-CBILS lending, are finding this increasingly difficult. In addition, we are seeing lenders restrict loan-to-values (LTVs) and making the criteria for serviceability even more stringent. Frustrating for all, especially when many lenders are banging the drum about supporting clients when, in fact, many are not so due to the above. There is also a question around actual capital available with many lenders having lent vast amounts using CBILS. The question is: do they have enough “cash” to lend out on traditional products, or are they holding fire to see how the economy reacts to the pandemic and imminent lockdown?
How have your clients’ ability to access finance been affected?
As many lenders have shut up shop, more people have found their way to our door. This is because, as commercial brokers, we work with a vast panel of high street banks as well as alternative lenders enabling us to access a much bigger pool of creditors. This way, we ensure we get the right type of funding at the best possible price.
What is the biggest challenge for your clients in the Covid world?
In a word: cash. In some instances, many businesses have been run hand to mouth with no reserves in case of a downturn or a crisis. So, getting funds into the business as quickly as possible has been the biggest challenge.
Read the full article in Niche Magazine.