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Articles | advisory, apps, finance, fintech, funding

Opening up a whole new world of funding for your clients

Helping your clients put down strong and stable financial foundations is what you do. But for your firm to make even more of a difference, you need to supercharge your funding conversations. 

That means talking about their business goals, their investment plans and their immediate funding needs. And once you have these strong relationships in place, you’re ready to help your clients explore the ever-expanding world of funding.

Helping ambitious businesses reach their potential

According to Capitalises’ Get Fit for Business report, 61% of business leaders are planning to expand their reach, product/service offering or team in 2022. But they’ll need funding to kickstart these investment plans, and the support of an experienced business adviser – like you.

Your role is to explain the different kinds of finance facilities and highlight the pros and cons of each option. By sharing your business finance knowledge, you can guide your clients towards a funding strategy that helps them reach their goals. 

But what finance options are out there? And what funding needs are they best suited to?The funding market is complex. There are plenty of different finance products and lending facilities out there. And many of them are tailored to specific business needs. But with Capitalises’ Marketplace tool you can make it as easy as possible for clients to find the best funding. 

Let’s take a look at some of the more popular finance products.

Business finance: to fund clients’ goals and operations

Business finance offers varied ways to borrow money and meet your clients funding needs. They might need money to buy an expensive new piece of machinery. Or they might need a short-term fix to an unexpected cashflow issue. What’s important is to talk to them, find out the real funding need and point them towards the appropriate finance facility.

Here are some of the most commonly used business finance products:

  • Asset finance allows clients to buy or refinance the equipment, plant and vehicles they need to grow. The cost is then spread over an agreed period of time.
  • Invoice finance lets clients advance the money owed to them in outstanding invoices, instead of waiting 14-120 days for their debtors to pay. It’s a fast, flexible way to access funds and smooth out cashflow.
  • Trade finance (also called purchase order finance or supplier finance) enables clients to take on more customers and fulfil bigger orders. Selected lenders will fund your client’s supplier upfront, based on the company’s confirmed orders.
  • Merchant cash advances allow clients to secure funding against future credit card sales or online revenue streams. Clients pay the advance back as a pre-agreed percentage of daily card transactions, so in months when they have less money coming in, they’ll also pay less back.
  • Revolving credit facilities provide funding when clients need short-term access to funds. This keeps their business trading effectively as the company continues to grow. 
  • Business overdrafts allow your clients to spend beyond their existing account balance. It’s a helpful financial buffer that can be used alongside a range of other kinds of funding. 
  • Management buyout finance allows the senior management team to access enough funding to buy out a business from its current owner/s. A common option is to borrow against the company’s existing business assets.
  • Refinancing is the process of reviewing a client’s existing funding facilities to look for better options. This will generally mean looking for alternative finance options that are more affordable or have better terms. 
  • VAT Funding enables a client to smooth their quarterly bill into 12 monthly payments by taking out a short-term business loan. This kind of loan unlocks the funds they need to

Find out more about the many finance options Capitalise offers.

Business loans: to help clients expand and grow

As clients grow or scale up their business, they’re likely to need larger sums of money. Business loans offer a way of borrowing these substantial funds, so the client can quickly act on any opportunities. The money can then be paid back in manageable instalments.

Loans come in two main varieties: secured and unsecured loans:

  • Secured loans allow clients to borrow large sums, by using assets or property owned by the business and/or owners as security. This kind of funding can scale as the business grows, offering additional funds as they’re needed.
  • Unsecured loans give the client flexible funding that can be used for almost any business purpose. They can then repay the loan as affordable repayments spread out over a term that suits their projected cashflow.

Property finance: to turn clients’ property plans into reality

Buying, building or developing property will involve some significant outlay for your clients. To make their property plans come to life, the client will need substantial funds in the bank. Property finance opens up the routes to funding they will need.

Common types of property funding include:

  • Commercial mortgages that are used to purchase a commercial property, either as part of a growth strategy or as a long-term investment. Clients could use this type of funding for a new purchase or to refinance an existing property. 
  • Development loans give clients access to the funds they need to develop residential or commercial properties from the ground up. These are usually only used by clients who have some existing experience and history in the development sector.
  • Bridging loans are used by property investors when they need to grab an opportunity fast. The loan might be used for an opportunistic purchase, to exit development finance. 

Government loans, grants and tax reliefs: to bump up clients’ cash position

Applying for funding from traditional or alternative lenders isn’t the only way your clients can access the fuel they need to reach their goal. There are also government-backed loans, grants and tax reliefs that can be used to boost their funding.

  • The Recovery Loan Scheme offers loans of up to £2 million for eligible businesses and will be available to UK businesses until June 2022. Find out more about recovery loans and how they can get clients’ finances back on track
  • Innovation grants provide grant funding for clients that are working on innovative projects. This could mean a research and development (R&D) project that meets the criteria or an innovative new business idea in their sector or industry.
  • R&D tax credits offer tax relief for clients that are carrying out qualifying R&D projects. Businesses can use the relief to reduce their corporation tax bill and offset this against their R&D expenses.

Helping your clients build healthier businesses

The Capitalise Marketplace gives you and your clients access to 100+ lenders and business finance specialists. Talk to clients, find out their main funding needs and then help them find the perfect finance facility for the job.

Through Capitalises’ Instant Offers partnership with Funding Circle, your clients can even apply for a loan of up to £100,000 directly from your website and get a decision straight away.

Find out more about the benefits of becoming a Capitalise accounting partner:

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