If your business hasn’t qualified for a CBILS (Corona Virus Business Interruption Loan Scheme) or Bounce Back Loan - like thousands of others in the UK - there are at least 6 ways to keep going. To manage your cash flow and improve your working capital tap into available business grants and uncover specialist lending options.
1. Apply for local, regional and specialist business grants: There are approximately 150 small business grants available throughout the UK, from business rates relief and business coaching grants to start-up and growth funds. Unlike with CBILS, you won’t need to pay back a loan.
2. Get additional tax relief: Talk to your accountant about specific tax relief schemes for your business. For example, more businesses than you would expect qualify for R&D tax relief because they do things differently, not necessarily because they operate in innovation sectors.
3. Release capital through asset refinance: If you have recently purchased a vehicle, piece of machinery or equipment for your business, you could resell it to a lender and then lease it back over a few months or even years.
4. Turn invoices into immediate cash: Having to wait for weeks or months to get paid does not help running a business. If you write bigger-ticket invoices for larger orders consider invoice factoring. Your factoring partner will often secure you funding against your invoice within 24 hours of raising it. This is also a great way of rescheduling existing borrowing, e.g. a bank overdraft. There are even some high street banks who offer invoice financing at favourable terms.
5. Consider revolving credit instead of bank overdraft: Did you know that when bank overdrafts are up for renewal banks often force customers to secure them through a debenture or debtor’s book? Instead, a revolving credit usually only requires a Personal Guarantee, no additional security or asset valuations. As a rolling agreement, a revolving credit runs between 6 months and 2 years and can be automatically renewed once the client repays a certain amount. With the increased flexibility, though, expect higher fees than for a fixed term loan.
6. Release capital through remortgaging property: In order to obtain credit at a good rate to further invest in your business you may be able to release funds by remortgaging your commercial property. If you pay off an existing mortgage and replace it with a new one, you may also be able to secure a more favourable interest rate.
Have I mentioned stock finance? If you would like to learn more about alternative funding and grants to navigate through the current market conditions drop me an email: bcacao@cc-finance.co.uk or call 0774 776 7312.
"If you need to raise funds for your business or property have you spoken with your bank yet?" This is the first question I ask business owners, property developers and landlords. High street banks…
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