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Bookkeepers launch small business funding pilot

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20th Nov 2011
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The Institute of Certified Bookkeepers (ICB) has teamed up with the National Association of Commercial Finance Brokers (NACFB) in a new initiative that is expected to improve the way in which small businesses work with lenders to secure finance.

The scheme is being piloted in the East Midlands covering ICB and NACFB members across four regions in Nottinghamshire, Lincolnshire, Derbyshire and Leicestershire.

Speaking at the ICB's Bookkeepers Summit 2011 in London chief executive Garry Carter confirmed that the programme will be the pre-cursor, if successful, to a major national campaign that will bring together bookkeepers and brokers.

ICB members in return will demonstrate how their record keeping and financial management systems could assist lenders in making decisions.

Under the scheme ICB members who put forward successful funding proposals on behalf of their clients or employers will receive a commission share of any deal.

Carter said: “It needs to be established exactly who within the SME sector, and particularly the micro sector, is trying to borrow. For those businesses who do want to borrow, the emphasis should be on ensuring their plans are credible.”

Carter, along with NACFB chief executive Adam Tyler, stressed that lenders need more than the 'back of a fag packet' when it comes to accessing finance.

The preparation of good up-to-date accounts must demonstrate to the lender that the business is run properly.

Tyler outlined the following borrowing criteria:

  • Audited or managed accounts
  • Accurate forecasts or projections
  • Experience of the borrower
  • Suitable deposit available
  • Detailed business plan
  • Including analysis SWOT (strengths, weaknesses, opportunities and threats)

A recent NACFB survey showed that although funding has improved slightly over the last couple of years, it’s still not enough. It remains difficult for SMEs, including accountants for businesses looking to grow, to access funds.

Tyler noted that in the last year there has been a 3.5% increase in asset finance and a rise of more than 6% in commercial mortgages. Invoice finance has increased for the fourth year in succession, which shows that businesses are looking for more cost effective ways of borrowing.

In recent months short-term lending has shot up, while asset finance brokers have struggled to find funders, which has in turn allowed smaller lessors to enter the market.

Tyler said that members of the NACFB have access to up to 70 providers of business finance including the big five high street banks.

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By johnjenkins
21st Nov 2011 12:07

With the greatest respect for all concerned

I really don't think that anything of this nature will move the big boys into lending. If they won't listen to the government then ?

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