Some lenders are changing their approach, but do they really have to?

Since Covid-19 we have all experienced how vulnerable the economy has become, especially in the world of business. If we explore the small business sector, there are daily reports about what is happening along with the types of businesses and industries that are suffering. Of course, there will always be businesses that suffer but this does not necessarily point to the economy, it could be due to a lack of new orders, a failing manufacturing process or a lack of trained professionals.

Here at NGI, we have established ourselves in the heart of the Oxfordshire and Thames Valley business community and can honestly say that we are surrounded by optimism rather than the pessimism. On a daily basis we receive calls from successful businesses who are looking to establish a line of funding to assist them with their next phase of growth.

As independent business finance specialists the one major concern we have is when lenders suddenly decide to stop working in a specific sector, resulting in funding stopping immediately. Often there is no reason for this, and we can only assume that the lenders are using a failing economy as the excuse.

Recently we have helped a family-owned business, who have a successful portfolio of commercial properties, to secure a new finance solution. Originally, they were working with an incumbent lender who advised them that they were exiting the commercial investment sector and therefore gave just 6 months’ notice that all of the company’s funds would be withdrawn.

We have also helped a public house who have been established since 1800. Having been supported by Santander for several years, their funding support was withdrawn with little notice. Fortunately, we were able to help them immediately and ensure their financial future for their next key milestone.

Sadly, the situation with lenders is that they have the right to pull out of a sector whenever they wish. This will always include the likes of retail, hospitality and construction sectors but it appears now that there is no guarantee for any sector. The one saving grace is that companies no longer must rely on these lenders. Instead, independent finance companies like ours can match clients with lending facilities that can meet their needs now and in the future.

If you have any questions or would like to discuss any aspect of business finance, please call us on 01993 706403 or e-mail enquiries@ngifinance.co.uk.