British Business Investments and IGF to pump £30m into small businesses
Helping to get "much needed working capital finance to fast-growing firms", start-ups can borrow against their property, equipment or inventory
British Business Investments, the commercial arm of the British Business Bank, is to provide £30m of funding to small businesses through commercial finance provider Independent Growth Finance (IGF).
Seen as an opportunity to get much needed working capital finance to fast-growing small firms, many of the recipients will have previously struggled to obtain finance from traditional lenders, who have generally reduced their credit appetite since the 2008 financial crisis.
A provider of asset-based lending products, IGF will allow applicants to borrow against assets they already own, including:
• Property owned and used by the business
• Plant and equipment including a variety of machinery and production equipment
• Inventory such as manufactured finished goods and stocks for resale.
Launched in 1997, IGF provides finance to businesses with a turnover of between £500,000 and £100m per annum.
This new funding line is open to small businesses who provide goods and services to other businesses.
In the 12 months to September 2017, IGF increased to £53m the funding it provides to businesses across the UK, an increase of 180% year-on-year.
John Onslow, CEO of IGF, said:
“Ten years on from the financial crisis, UK small businesses are still struggling to access the finance they need to grow their businesses.
“Our partnership with British Business Investments will provide much needed finance to small businesses. The finance we will be providing allows them to unlock the value of the assets they own and use them to borrow funds to expand and create jobs.”
“We think that we have only begun to scratch the surface in this form of finance. It has enormous growth potential.”
Catherine Lewis La Torre, chief executive officer at British Business Investments, said:
“For innovative smaller businesses, asset based lending can be the key to unlocking rapid growth without losing control of their business.
“This £30m commitment with IGF is another vital step in supporting businesses that are looking to expand, and is a further demonstration of our commitment to increasing the diversity of finance available to small businesses.”