Chelmsford Businesses Secure More Funding With Business Finance Brokers

Business is Booming in the UK’s Newest City

Chelmsford is seeing a boom in independent businesses, thanks to a thriving city and a broad choice of funding options.

Welcome to Chelmsford, the birthplace of radio. Anyone driving into the city cannot miss the signs, and they serve as a reminder of Chelmsford’s pioneering past. However, while Marconi might now be part of the city’s illustrious history, there is no shortage of vibrant new businesses carrying the mantle. They are maintaining Chelmsford’s reputation as a city where innovation, imagination and an enterprising spirit will always pay dividends.

From a range of new cafes and retail outlets in the city centre to boutique web designers, SEO agencies and PR firms in the regenerated suburbs, new businesses are thriving. Among them, you can find business finance brokers in Chelmsford who offer a wide array of funding options to help take those small start ups to the next level in their evolution. Let’s take a look at some of the choices that are available.

Invoice financing

There are different varieties of invoice financing, but in essence, it means to borrow money on the basis of outstanding invoice amounts. It is a hassle-free and convenient way for a business to raise funds when they are needed at short notice. This might be to make cash available to fund a new project, or simply to navigate a short-term dip in cash flow.

The precise mechanism depends on the type of invoice financing, but what usually happens is that outwardly, it is business as usual and the company invoices its clients as it normally would. But instead of waiting for payment, it receives a percentage of the money immediately from the lender. Once the invoice is paid, it receives the balance, less the agreed financing fee.

One of the key benefits of invoice financing is that the creditworthiness of the borrower is not a factor, as the only risk for the lender is of the end client not paying his bill.

Asset financing

This is more along the lines of a conventional secured loan, and it is taken out against existing assets that act as a guarantee. Asset financing is an ideal way for asset-rich companies to raise funds for new capital investments to expand their size and scope.

Unsecured loans

Of course, many SMEs are not asset-rich, particularly if they operate predominantly online in the knowledge economy. Every problem represents an opportunity, so there are plenty of lenders out there offering unsecured loans to businesses in this category.

An unsecured loan has the advantage of being less complex than asset financing as there is no need to spend time assessing the value of the asset and so on. The loan is made on the basis of the business’s performance and projected returns, and, of course, its creditworthiness.

An unsecured loan has less inherent risk to the borrower, as no tangible assets are being put on the line. The flip side is a higher level of risk to the lender, so interest rates will be higher. Having said that, the increased number of lenders prepared to offer unsecured loans has made this a competitive market, so the right advisor will be able to find some great deals.

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