Banks – Banking n Finance » 2009 » April

HSBC has moved to persuade SMEs to think about invoice finance when combating overdue payment and money flow issues.   According to analyze by BACS Payment in March 2009, payments owed to SMEs have risen by nearly forty per cent in the year to £26 bill and many businesses are caught in an unsustainable cycle of firms billing faster and taking longer to pay.

Figures show that SMEs are being made to wait up to 6 weeks after the concluded payment date to get payment.  Yet, asserts HSBC, only 1 in ten companies are at present using invoice finance to disencumber their cashflow according to investigate from HSBC Commercial Banking.

With money released often inside one day of the invoice being issued, invoice finance makes funds available which can enable SMEs to reply quickly and decisively in challenging market conditions.  With the recession placing increased stress on UK businesses 64 pc of SMEs say that handling cashflow in the present economic environment is their largest challenge for growth.

Effectively handling cashflow is only one of the tips included in an internet video launched by HSBC Commercial Banking which features a collection of stories from real companies, practical recommendation from monetary experts and economic gurus offering top tips on thrashing the liquidity crunch. Noel Quinn, HSBC’s head of commercial banking UK, announced : “We are prompting companies to guarantee they have the right fiscal tools in place and are looking for acceptable recommendation to help them weather the typhoon.

Finally a healthy cashflow is urgent in a downturn and companies do have the option, thru invoice finance, of working with a monetary partner to carry out their payment collections for them letting them target the running of their business.

“We understand the pressure that companies are under in the present climate and in an attempt to relieve some of the pressure we have already told the supply of a £1 bill working capital fund that has been in particular designed to help SMEs and make the day by day running of business more manageable.