Solving Cash flow problems for SME’s

Solving Cash flow problems for SME’s

SME’s are one of the sectors hit hardest by poor cash flow, especially in Australia. This is one reason why aggregator AFG has chosen to partner with Prospa, a small business lender that also happens to be web-based.

AFG is a leading Australian aggregator, which has around 2,300 mortgage brokers on its books. Their role is to connect brokers with reputable lenders, who can offer businesses and individuals competitive loans.

More SME’s are turning to debtor finance and other cashflow lending solutions to assist with the fluctuations that happen during invoice cycles.

Put simply, a cash flow lender helps a business pay off invoices when it’s own debtors are slow to pay.

Pros of Cash flow Lending for SME’s

  • Larger companies tend to take longer to pay smaller companies, which makes it harder for SME’s to reconcile invoices within required terms.
  • Speedy online lending solutions enable small non-bank lenders to meet the growing cash flow needs of SME’s in record-time.
  • An influx of non-bank cash flow lenders inevitably leads to greater competition and better rates for SME’s.

Cons of Cash flow Lending for SME’s

  • Cash flow loans are often unsecured, which means interest rates can be higher.
  • Many businesses choose to rely on credit cards to handle cash flow issues, and this is certainly an effective solution.
  • Online lending is relatively new, and it is important to be wary of the risks involved. Head here for more on this issue.

Capita Finance Solutions has a dedicated commercial broker who can assist you with securing a cash flow loan. Contact us to discuss your options.