Establishing Finance Platforms to increase financing opportunities for smaller businesses
From 1 November 2016, if a small business is rejected for finance by the big banks they are now obliged to offer the business a referral to a designated, online finance platform. These platforms give alternative finance providers the opportunity to offer viable businesses the finance they need.
Designated banks now need to offer any SME they decline for finance the opportunity for their details to be referred to a designated platform. These platforms will help match the SME with alternative finance provider that could provide them with the finance they need to grow and expand.
In 2015 we ran an expressions of interest and a request for proposals for finance platforms that wanted to be designated by HM Treasury to participate in this system. HM Treasury announced their intention to designate the first three platform providers – Bizfitech (business finance compared), Funding Options and Funding Xchange – at Budget 2016.
NB – the deadline for applications for this round has now passed.
For reference, the documents for the process are available on our expressions of interest and request for proposals page
The Asset-based Finance Association (ABFA) has also published its own guide to the regulations and how they relate to invoice finance, which is downloadable from the ABFA website.