Successful businesses are the ones who are able to recognise an opportunity in the market and grab it quickly, while the going is good. One of the key issues here of course, is that it is very difficult to predict exactly when those opportunities are going to come along, and even harder is having the necessary resources to be able to grab them with. It can be incredibly frustrating to have an opportunity to take on a phenomenal amount of work, only to have to turn it down as the businesses cash flow prevents you from taking it up. For example think of the home maintenance company, inundated with work requests after properties have been damaged by a storm, but unable to buy the materials to do all of the work, as the insurance company isn’t paying up fast enough. Sadly the banks do not seem to be able to understand such urgent needs of cash, and may take weeks or longer to process your application for a loan, by which time the opportunity has passed you by.
Fast Short Term Funding
While traditionally, thesmall to medium sized business, is the sector most likely to require a rapid injection of funds, they are also those who have often found it the hardest to actually get. Banks, like all large companies, are somewhat cumbersome and slow to react to market changes. They have operated along very similar lines, for a very long time, and are only slowly waking up to the fact that technology is revolutionising the financial markets, giving potential borrowers many more options to find lenders offering short term business loans.
Changes in the Marketplace
Financial Technology, known in the industry as FinTech, has changed, and is changing the way in which money is moved around and lent, on a global scale. Blockchain technology and crypto currency are terms we are starting to hear ever more frequently. Advances have meant that it is now possible to move money from anywhere in the world, to anywhere else faster and cheaper than ever before. This means that finance companies no longer have to source the funds with which to lend in their local market, but instead are able to find it from just about anywhere, on terms often far more favourable than those offered by the local banks.
What it Means for the Borrower
When you borrow money from the bank, you are being offered a standard off the shelf, one size fits all, loan, offered by the bank, with the bank determining all terms and conditions of the loan. The problem with off the rack products is that of course, they generally do not fit as well as a bespoke offering and it is the same with finance. The new alternative finance market allows you to choose the parameters for the loan, so if you want a three month loan you get one, not a one year loan from the bank, costing you interest for nine months more than necessary.
An automated search finds exactly the right lender, with the exact repayment amounts you have chosen, and generally means you can have the money in minutes, with a far better deal than the bank will be offering.