Most Invoice Discounting customers would recommend the service to others
07th Sep 2010
by Barry Mills
The clear majority of UK SMEs polled who are using invoice discounting and factoring would recommend it as an essential form of funding, according to an ABFA/Yougov poll. The Asset Based Finance Association commissioned a YouGov survey of SMEs using invoice discounting or factoring. The survey assessed the clients' views regarding the economic environment and how they feel about the use of invoice finance, and revealed that 82 per cent would recommend it to other businesses in a similar position.
When asked what the single biggest benefit of using invoice discounting or factoring was, by far the most popular answer was the immediate access to finance. Sixty five per cent of SMEs said this was the most important benefit.
Business sentiment also seems to be improving. Seventy one per cent of SMEs polled were either very or slightly optimistic about the future. However, while firms might be broadly optimistic about the future, they still firmly believe that the recession is still affecting them, with 85 per cent of SMEs polled saying that they do not believe they are out of the recession yet.
These are interesting results. SMEs seem surprisingly optimistic in the current economic climate, although perhaps we shouldn't look at that as an indicator for the wider economy, since the survey covered specifically firms using invoice discounting or factoring already, which are likely to be among the more progressive and solvent companies out there.
It's also interesting to see that such an overwhelming majority of companies using invoice finance would recommend it to others. Sometimes, invoice finance, particularly factoring, seems to be regarded as a last resort by firms who have not used it. I've heard people express concerns about the prohibitive costs, which are completely groundless, it's one of the cheapest sources of finance around. I've heard concerns about the risk of conveying an impression of desperation by having stickers on your invoices. That may have had some truth 20/30 years ago, but I really don't think this has been the case for a very long time. People also worry about the administrative burden, but it's really not a big deal at all, and many companies using invoice finance find that they end up with less work to do, and benefit from the improved focus on invoicing and credit control.
Generally, if you are unsure about something, it pays to listen to people with experience. When 82% of customers recommend a service, it has to be worth a look. If your business needs funds, find out if invoice finance is for you by completing our simple enquiry form or calling us on 0844 875 3450