December 20 2016.

Alternative financiers are transforming the SME finance landscape, leveraging cloud technology, real-time data and analytics tools to provide businesses with smart, efficient and cost-effective finance and debtor management solutions. In fact, we have reached the point where technology is enabling such levels of control for business owners that they are effectively being allowed to become their own bank managers. Indeed, the era of on-demand business finance has arrived.

Through selective invoice finance, for example, SMEs can decide which pre-approved invoices they want to draw on according to their needs (as opposed to the whole ledger having to be financed). What’s more, they can choose to draw on the invoices they know will be repaid the soonest, enabling business owners to minimise costs. This means they can control how much they borrow, when, against which invoices and for how long, for a transparent daily charge with no hidden extras.

The flexibility of selective invoice finance allows the facility to grow in tandem with turnover, which makes it especially valuable to seasonal and expanding businesses.

This innovative form of funding is being made possible by the rapid evolution of digital capabilities. Providers are developing sophisticated platforms that seamlessly integrate with business accounting packages via online and cloud technology, allowing them to monitor businesses in real-time, gain enhanced insight into payments and cash, and offer near-instant funding. The extent of the real-time data available means that, from a risk perspective, providers can establish a comprehensive understanding of the suitability of companies wanting to be financed, opening up financing channels for those that may be denied by more traditional lenders.

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