Industry News, News, SME News, Top 3 Innovate Finance, Roger Vincent, Trade Ledger
Traditional lenders have been urged to upgrade their technology to ensure they can help counteract the increased cost of doing business.
Fintech lender Trade Ledger believes this is critical as more businesses find themselves in need of working capital but are struggling to secure it.
“The current business lending model is definitely not fit for purpose in the face of the current economic challenges,” said Roger Vincent, global VP of sales at Trade Ledger.
“The reality is the depth of data on business performance is now so much richer than in 2008 at the time of the last recession.”
He said the greater availability of data means it is possible to lend with greater confidence and offer specialist working capital facilities like invoice finance and asset-based lending, easily and cost-effectively.
Read more: Trade Ledger partners with Equifax to create credit profiles for SMEs
Trade Ledger’s ‘Next-generation working capital – the $ multi-trillion opportunity’ report outlines a framework for lenders to unlock the next-generation of working capital solutions for their customers.
By utilising real-time business data supplied by the customer, as well as other reliable sources, the right facility can be offered in a digital application process which is fulfilled in a few hours, according to Trade Ledger.
Trade Ledger pointed to EY’s report, the five-step journey to SME banking transformation, which highlights the risks to customer retention of slow lending processes.
The accountancy giant reported that 52 per cent of small businesses quote the application process as the main reason for dissatisfaction with the current lending process, while one in two said they would like to be funded within seven days, and one in three within three days.
Read more: New review into fintech funding launches
“Right now it’s vital we reimagine the process that businesses go through to get a working capital facility in place so that they are well supported over the coming months,” added Vincent.
Trade Ledger’s plea to lenders came as fintech trade body Innovate Finance called on the new prime minister, Liz Truss, to “cement the UK as the world’s leading financial centre”, by shoring up fintech regulation and making it easier for small businesses to access finance.
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