The heady combination of the credit crunch and recession has undoubtedly redefined the ways that banks conduct their lending, typically focusing on larger sums and blue chip client’s, often neglecting the needs of SME’s and small businesses. This leaves a huge percentage of the market place looking for alternative and sound lending, a key factor cited in the upsurge of deals completed using bridging finance.
The bridging market has in effect doubled in the past 12 months, a trend which has coincided with growth at Bridging Finance Solutions. It is clear to see that the smaller transactions which have driven down banking volumes have boosted bridging finance volumes. As demand continues to increase, BFS are seeing more lenders enter the market with each bridging company finding their own niche and core focus.
John Hardman, pictured, Head of Sales at Bridging Finance Solutions commented:
“Businesses are keen to explore other ways to finance their business when high street lending isn’t an option. As well as seeking solutions independently, they are being guided by professionals affiliated with their business such as solicitors, brokers and accountants who can support them in devising solutions that will raise finance in the short term. Collaboration and partnerships with solid and reputable professional teams offers further validation that this type of lending is viable .
“Firms such as Bridging Finance Solutions ultimately will work with the client to structure a deal that’s right for them and we have the internal resources and infrastructure to do this, unlike many high street lenders.” John continued: “Every deal is unique and so requires a detailed commercial approach to help devise a strategy and drive that through – these are very much fundamentals to a bridging finance deal – factors that high street lenders simply don’t have the resources for or indeed appetite to manage.”
“It has become very difficult to predict how the high street views lending, one moment they are championing the cause of the small business person and property developer yet many of the cases we see are where a client or their finance broker has already approached their own bank and been shown very little interest. Certainly there is room for growth in both sectors and there needs to be a mix of dual offerings to enable clients to best maximise their own projects, both short term and by using long term debt from a bank.”
Once the high street lender is clearly not an option for a business, BFS recommend engaging the services of a professional such as an accountant, solicitor or financial adviser/broker. As there is so much choice within the alternative lending space, a good quality advisor will quickly be able to narrow this choice down and provide appropriate advice before we get involved. Over half of BFS business is generated this way currently and marks an upward trend moving forward.