When a business needs to invest in growth, buy larger assets or simply take some pressure off cash flow, asset finance is one of the options available. This is where a company borrows against the value of the hard and soft assets it owns. There are a huge range of asset finance asset based lenders uk companies in the UK, and they specialise in different types of loan and agreements. Many of these providers also have a variety of specialist areas and sectors, meaning that they can provide the right financing to fit your business.

For many businesses, this is a more flexible alternative to bank financing, which can be slow, complicated and often comes with conditions attached. Banks usually rely on the creditworthiness, profitability and cash flow of the company to assess whether it is a good candidate for their lending. An asset based lender, on the other hand, concentrates more on what is actually being collected in terms of invoices, inventory and accounts receivable. This allows them to provide higher advance rates on the eligible assets, as well as covenants based upon projected collections and other key business metrics.

In its simplest form, asset finance is invoice finance (also known as factoring), where a company will secure a loan against between 70 and 85 per cent of the value of its outstanding invoices. As the industry has developed, it has grown to cover a wide variety of physical assets, including plant and machinery, stock, inventory and property, as well as intangible soft assets such as customer databases. Some asset financiers will also provide a cash flow advance alongside their facilities, allowing a business to borrow against its accounts payable as well as its outstanding invoices.

The benefits of this type of finance are considerable. It makes the purchase of large assets – such as vehicles, IT equipment and industrial plants – easier, by spreading the cost over time, taking some of the pressure off the business’s cashflow. It can also make it easier to access financing for more intangible soft assets, such as intellectual property.

While asset finance has a reputation for being complex and time-consuming, the rapid evolution of cloud and platform technology has greatly sped up the process. The legal side of asset-based lending has also become smoother thanks to the standardisation of Loan Market Association (LMA) documents and templates.

There is a range of lenders to choose from, and Swoop works with most of them. Contact us to find out more about what is on offer and how we can help you to secure the funding your business needs. We can match you with the ideal provider, depending on the strength of your business, what kind of asset finance you are looking for and the value of the assets you are offering as security. This includes many of the major banks, as well as a number of smaller specialist lenders and alternative funders.