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This situation is having large implications for business development in the UK. This situation is massively restricting opportunities for business growth in the UK and strangling economic recovery.

There are however some perhaps less well known avenues for raising business finance which company directors and business owners should be aware about. These are collectively known as business refinancing. The main types of business refinancing are described below.

1. Asset Refinancing

Asset refinancing is simply the process of borrowing against the value of any fixed assets which are owned by the business. For example, if the business has any plant or machinery which it owns outright (no finance or charge currently outstanding), money can be lent to the business against the value of these assets. Assets that are already on finance can also be refinanced as long as the existing finance company is paid off as part of the process.

2. Invoice Financing

Invoice financing is the process of raising money based on a company’s outstanding invoices. Invoice financing could allow a company to draw down up to 90% of the invoice value immediately on the issue of a valid invoice. The company still has the responsibility for ensuring invoices are paid and paid on time.

3. Trade Finance

Typically suppliers are paid directly by the finance company who also invoice the customer directly. Once the customer has paid the finance company, adhering to the typical payment terms, they will release any profits back to the business, minus their fees.

Business refinance options are not only useful for companies which are on a reasonable financial footing. Business refinancing solutions can be considered to support these business rescue initiatives.

Obviously, business refinancing will will require the usual guarantees from company directors. However, this situation is quite simply no different to the requirements of the high street banks when considering the lending of overdraft  facilities.