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Funding Options launches accountant platform

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Business finance marketplace Funding Options has launched an advisory platform aiming to offer accountants the ability to match small business clients with suitable funding options, depending on their eligibility and needs.

31st Mar 2022
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The Funding Cloud: Connect tool from Funding Options is an extension of the company’s Funding Cloud platform and allows accountants to create an account and refer clients for funding. They can track the status of clients’ applications in real-time through a dashboard on the tool.

During the pandemic, government assistance through an array of grant and loan schemes helped keep many businesses afloat. Now with grants coming to an end, loans falling due for repayment, rising running costs and continuing issues with late payments, the UK’s business cashflow landscape may be facing a significant downturn - a trend borne out by rising company insolvency statistics.

This cash-flow issue is a gap that Funding Options believes accountants can help to fill with their small business clients as part of a new or expanded service line. Using their new adviser platform, accountants can source finance between £1,000 and £15m for clients from a panel of up to 120 lenders.

Using the company’s open accounting connectivity, Funding Options hooks up to major accounting software vendors such as CCH and Intuit QuickBooks and searches the market to match client needs with the right lender and finance option.

Speed of approval

One way in which Funding Options hopes to elevate itself from the competition is via speed of approval and transfer of funds, utilising the tool’s connectivity function to tackle the perceived inefficiencies of traditional funding provider processes. “Through our Funding Cloud tool the fastest time from loan application to credit approved is 20 seconds, and the fastest we’ve seen from application to funds in the bank is just 18 minutes,” Thomas Boyd, head of commercial at Funding Options, told AccountingWEB.

Demand for funding reached record levels during the pandemic and have remained high – according to the BVA BDRC SME Finance Monitor, in Q2 2021, 61% of SMEs said they were using more finance now than pre-pandemic, with 36% borrowing for the first time. “In early 2020, we saw an 80% increase in applications for funding between February and March,” said Boyd, “and demand has stayed above pre-pandemic levels ever since.”

However, as you might expect in the current economic climate, funding application approval rates have not kept pace with demand. 

Value accountants bring

Research shows that small businesses have an improved chance of success if an accountant is involved in the process. “The value accountants bring to the application process is clear,” said Courtney Way, marketing director at Funding Options. “Our data shows that SMEs are almost 10 times more likely to be successful with a funding application when they apply via their accountant.”

In the past, accountants with small business clients have been reluctant to recommend cash-flow funding alternatives for a variety of reasons, whether that’s capacity, an ability to price the service line or simply a reluctance to engage based on the traditionally high rates of interest in the sector.

Whether this new wave of slicker, faster cash-flow funding alternatives, that aim to use technology to drive down the cost of such lending, will be enough to convince accountants to take on a new service line will be an interesting trend for seasoned accounting industry software watchers to follow. 

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By Hugo Fair
01st Apr 2022 19:24

It's a sad fact of life that many (most?) businesses seeking this kind of 'funding option' are in dire straits (not the band) ... which is why so many will still fail after taking out the finance proffered ... which is why the rates charged are usually so eye-wateringly high ... which is why if your business is NOT in dire straits (but has a valid short-term need for cash) you should seek elsewhere.

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