SMALL and medium-sized businesses need access to finance to grow and access to working capital to survive.

According to the CBI’s report ‘Future Champions’, the medium-sized firms could be worth an additional £20billion to the economy by 2020 but only if they can access the finance they need to grow.

The financial crisis has taken its toll on the ability of a business to borrow on extended overdrafts and loans.

The perception of banks that won’t lend has led businesses to explore alternative methods of raising finance. There are a lot about.

The most innovative form has been through crowd funding and peer to peer financing allowing businesses to access funding for a specific project.

It works through an internet platform with the business making a pitch and the investor deciding how much it will lend.

The return to the investor is either a finished product, interest on the loan or shares in your company.

From next month peer to peer and crowd funding will be regulated by the Financial Conduct Authority which can only give confidence and respectability to a growing market.

If a business is willing to use equity to encourage investment, Business Angels maybe a solution.

They are high net worth individuals who like to get involved with a hands on approach. They look for high growth businesses. They operate though networks or syndicates. Their advice as well as the contacts they may offer can mark the difference between struggling to bring a business concept to market and achieving that growth.

Asset financing offers access to loans with the provision of plant, machinery stock, property or the debtor book as security. The most common form is invoice financing which tackles the stunted cashflow by bridging that time between delivery of the good and service and the eventual payment by the customer. Online invoice trading platforms allow a business to sell that invoice in real time.

The Government has also joined the finance bandwagon with the announcement of the establishment of a state backed business bank which will bring together the different avenues of government funding and support in one place.

These options are just some of the variety of investment sources for small and medium sized businesses that are cut off from traditional lending. Its time for the banks to wake up to the competition.

For more information and an informal discussion about how we can help your business, contact Sally Taylor on 01823-362898 or sally.taylor@everys.co.uk