Funding Xchange and Enterprise Nation launch Business Finance Hub to support businesses struggling to secure finance

Funding Xchange (FXE), the finance platform powering MoneySuperMarket’s business funding channel, and the UK’s fastest growing business support provider, Enterprise Nation, are joining forces to support small businesses and start-ups with financial support.

The partnership will provide users with access to free online resources, a tool to help businesses identify and access funding solutions, and connections to advisers.

Today’s launch of the ‘Enterprise Nation Finance Hub’ provides businesses with instant access to finance options. The new digital lending tool, hosted on the Enterprise Nation website, will help businesses understand the full range of funding solutions open to them. The secure application process takes under five minutes with types of finance available presented back immediately.

In the first quarter of 2021 a new financial e-learning tool to deliver training on how to raise funds, angel investment, debt and equity investment, will also be launched, in addition to an accreditation programme for advisers enabling them to use the platform for their clients.

The partnership means firms looking to assess their range of finance options in one place, can also benefit from business support, business-building e-learning tools, and crucially, Enterprise Nation’s network of 10,000 advisers.

Emma Jones, founder of Enterprise Nation said: “Getting access to alternative sources of funding can be complicated and time-consuming, two things small business owners do not have the time for.

“Our new Finance Hub, powered by Funding Xchange, will dramatically improve that process by delivering relevant and instant funding options to the screens and inboxes of thousands of small businesses looking for solid finance solutions.

“If 2020 has taught us anything, it is that seeking the right finance at the right moment can be life changing for any business and combining finance with good support is a vital way to grow a business.”

Katrin Herrling, CEO of Funding Xchange said: “Businesses have shown huge resilience over the last year. As we are continuing to navigate unchartered territory, access to sustainable, affordable funding solutions is critical to give businesses the flexibility to adjust and respond to challenges. For many businesses, this funding gap is filled by a cohort of excellent alternative lenders.

“But businesses struggle to know where to look for the alternatives, and the Enterprise Nation Finance Hub will address this by providing much-needed access to tools and advisers – as well as tailored finance solutions, making a huge difference to the growth ambitions of many thousands of small businesses.”

In September, the partnership announced it had won funding from the RBS Remedies Fund to deliver the Finance Hub that brings together Enterprise Nation’s experience in delivering access to learning resources and advisers with Funding Xchange’s ability to seamlessly connect businesses to funding solutions. The Hub will feature finance offers from digital and challenger banks and alternate lenders and is projected to support thousands of businesses that are finding it challenging to access funding solutions.

Together increases use of digital valuations across its personal finance product range

Together has updated its criteria to allow more automatic property valuations in a move designed to reduce costs and speed up mortgage applications.

The specialist lender estimates that the rule changes will mean more than half of its new personal finance cases can now be funded by using the HomeTrack digital platform – removing the need for physical property valuations.

This will make it easier for applications to progress, particularly during lockdown, and could benefit customers looking to take advantage of the stamp duty holiday by moving before the Government scheme ends in March, a Together spokesman said.

Sundeep Patel, the lender’s head of intermediary sales, said: “We estimate that changes to our rules mean we will be able to use Hometrack’s AVM (automated valuation model) in more than 50 per cent of personal finance applications, up from about a third of cases in 2019.

“It’s an incredibly useful tool, particularly under the current Covid-related lockdown restrictions, and could reduce costs for intermediaries submitting cases to us, while speeding up the application process by removing the time it takes for physical valuations of properties.

“We have brought in these rule changes to streamline the process at a time when hundreds of thousands of home buyers are looking to complete transactions ahead of the stamp duty holiday deadline at the end of March.”

The enhanced AVM rules apply across all Together’s personal finance products, with a maximum LTV of 70 per cent (65 per cent for regulated bridging applications), to a maximum loan size of £250,000 and with a confidence level of 5+.

Previously, Together allowed digital valuations for its mortgages on properties worth up to £500,000. The lender will now accept automatic valuations for regulated bridging as well as first charge loans, with no maximum property value. The maximum property value for second charge loans has been increased to £750,000.

For home purchases, Together will accept the minimum Hometrack valuation or purchase price, or the council valuation for right to buy properties, while physical valuations will still be needed on shared ownership properties, those of non-standard construction and new-builds.

Manufacturers outperform other sector, amid better growth expectations for 2021

Manufacturers helped push the UK’s economic recovery ahead of the global benchmark in December, according to the latest Lloyds Bank UK Recovery Tracker.

The Tracker, compiled working with IHS Markit, provides unique insight into the shape and pace of the UK’s recovery following the huge disruption caused by Covid-19. The latest data was compiled between 4th and 21st December 2020, ahead of the introduction of tighter lockdown restrictions at the end of the month, which should impact January’s results in certain sectors such as hospitality and tourism.

Eight of the fourteen UK sectors monitored by the Tracker were ahead of the global index in December, up from six in November. Firms in the manufacturing industry, which posted a seven-month run of growth and helped slow falling UK GDP in November, were the biggest contributors to output growth in the final month of the year.

A spike in demand from overseas buyers ahead of the Brexit trade deadline pushed the output of the chemicals (63.2), household products (57.1) and beverages and food manufacturing (54.6) sectors ahead of their global counterparts in December. A reading above 50 signals output is rising, while a reading below 50 indicates output is contracting.

Meanwhile, transportation (56.9) outstripped global performance by the largest margin in December. This was the sector’s first rise in activity since July and its fastest growth for nearly two-and-a-half years. The performance was driven by the lifting of national lockdown measures in early December and an end-of-year spike in demand for logistics services ahead of the Brexit trade deadline.

Vaccine rollout drives UK businesses 2021 growth expectations

Looking at a measure of expected output volumes, 11 of the fourteen sectors monitored by the Tracker anticipated stronger output growth than their global peers over the next 12 months during December, as the UK’s Covid-19 vaccination programme got underway.

The UK’s software services sector’s expectations for growth were strongest of all sectors and well ahead of the rest of the world in December, with a reading of 81.5 against the global benchmark of 70.9. Accounting for the positive outlook, providers anticipate increased corporate investment in digital services to continue in 2021. A reading above 50 signals that respondents expect output to rise in the next 12 months, while a reading below 50 indicates output is expected to contract.

The industrial goods sector (75.6) was among those furthest ahead of the global benchmark (66.2) in December. The expectation of increased investment in industrial development and a positive outlook for the UK construction industry was behind the sector’s optimism for the next 12 months.

Chemicals (64.7), transportation (62) and real estate (58) were the only UK sectors monitored by the Tracker with 2021 growth expectations behind the global benchmark in December.

Chemicals producers commented on a slowdown in demand after sales to overseas buyers spiked ahead of the agreement of a trade deal with the European Union. Transport and real estate businesses anticipated another uncertain year for commercial property rentals and public transport, with many firms indicating employees will continue to work from home for a large proportion of 2021.

UK manufacturers’ growth expectations for 2021 weakened by rising costs

While still well above the 50 mark that signals output is expected to rise over the next 12 months, the growth expectations of four UK manufacturing sectors weakened during December – chemicals (64.7 in December v 70 in November), metals and mining (69 vs 75), beverages and food (72.2 vs 77.4) and automobiles and auto parts (73.5 vs 73.7).

Signs of inflationary pressures across the UK economy contributed to these sectors’ weaker output expectations for the next 12 months. Supply chain delays and the imbalance of container freight activity during 2020 led to a steep rise in shipping costs during December. Global raw material shortages also meant that UK manufacturers faced the sharpest rise in input prices for two-and-a-half years. Both factors are expected to increase prices charged by UK goods producers, which could negatively impact the competitiveness of domestic manufacturers in overseas markets during 2021.

Jeavon Lolay, Head of Economics and Market Insight, Lloyds Bank Commercial Banking, said: “While this survey was conducted before the latest national lockdown was announced, it is still worth highlighting the vaccine-induced rebound in business confidence across the economy. It is clear that, for many firms, this represents the defining influence for their prospects in the year ahead.

“December’s data also highlighted the impact Covid-19 continues to have on global supply chains. Many manufacturers benefited from a boost in overseas sales ahead of the Brexit trade deadline, but raw material shortages, rising input costs and distribution problems are making the sector’s road to recovery more challenging.”

Scott Barton, Managing Director, Corporate and Institutional Coverage, Lloyds Bank Commercial Banking, added: “Growth expectations for the next 12 months help us chart the trajectory of the UK economy’s recovery from Covid-19. However, we cannot forget the incredibly challenging conditions businesses are currently facing during lockdown. Our immediate priority must be to support UK firms as they continue to demonstrate resilience and innovation in the face of adversity.”

United Trust Bank funds £11m redevelopment in a stunning beachside location

United Trust Bank (UTB) has agreed to fund a development of 14 luxury two and three bedroom apartments and ground floor commercial space being undertaken by developers Harrington Homes.

The 3-storey development will be built on the site of the former Harlyn Inn Hotel situated adjacent to the beach on Harlyn Bay, considered one of the best and safest family beaches in Cornwall.

Specialist debt advisors, Brotherton Real Estate, introduced Harrington Homes to United Trust Bank in October 2020 with a short deadline for the purchase of the site, and completion due to take place in early November. With additional challenges presented by Covid -19, it wasn’t possible to undertake a site meeting prior to giving a credit decision within the tight timescales. However, UTB’s Mark Pannell arranged Zoom meetings with Robert Kleinman from Brotherton Real Estate and Harrington Homes’ principals to discuss and agree a suitable funding package. Although Harrington Homes are new UTB customers, they have extensive development experience and a strong track record of delivering successful, high specification projects around the South West.

Mark Pannell presented the proposal to UTB’s Credit Committee, which is currently meeting daily via video conference, and approval was quickly given to provide the £6.18m required to cover the balance of the site purchase, construction costs, professional fees and CIL / Section 106 obligations. An extended repayment term was agreed to provide Harrington Homes with greater flexibility should the pandemic create disruption to the construction timetable.

Demolition works were underway within two weeks of the completion of the site acquisition and the first apartments should be released for sale around Easter 2021. However Harrington Homes have already received considerable interest in the new properties.

Gareth Hughes, Director of Harrington Homes (SW) Ltd, commented: “Despite having to overcome some additional challenges created by the pandemic, United Trust Bank and Brotherton Real Estate worked closely to turn around our proposal quickly and enabled us to complete the purchase of the site within a very tight timescale. Although we have benefitted from Brotherton’s assistance on several occasions, this is the first development where UTB have provided the funding and I hope this will be the start of a long and mutually beneficial relationship.”

Robert Kleinman, CFO of Brotherton Real Estate, commented: “Mark Pannell and the United Trust Bank team pulled out all the stops to provide a quick decision on this deal and have the funds available within around six weeks of our first conversations. They’re a pleasure to work with and are always keen to back good developers like Harrington Homes who are providing high quality new homes where there’s demand. I’m very pleased to get another competitive funding deal with UTB over the line and look forward to working together on future deals.”

Mark Pannell, Senior Manager – Property Development, United Trust Bank commented: “Harrington Homes have established a strong reputation for delivering high quality developments and I’m delighted that UTB will be providing the funding to create these superb homes in a stunning location. We had to move quickly on this deal and Brotherton’s involvement was crucial to us getting all the information we needed when we needed it. It was an excellent example of developer, introducer and lender working in unison to meet a challenging deadline.

“With around 40 buyers already showing interest in the apartments, I’m sure this will be another successful development for Harrington Homes and the Bank.”

Care home finance remains in the spotlight despite Government support

While new admissions to care homes are beginning to return to pre-lockdown levels, they likely remain sensitive to further restrictions while COVID-19 is brought under control with the widespread vaccination programme, according to Duff & Phelps, the world’s premier provider of governance, risk and transparency solutions.

Benjamin Wiles, Managing Director, Restructuring Advisory, Duff & Phelps, stated: “Prior to the outbreak many providers were operating with incredibly tight margins, so any reduction in patient numbers was going to have a dramatic effect at a time when care homes are seeing additional cost pressures associated with personal protection equipment (PPE), staff sickness and costly agency staff.

“The Government launched an ‘infection control fund’ to offset the additional costs incurred by service providers, and this has subsequently been topped up with an additional £546m and extended through to March 2021. While this is welcome news for the sector, it does not address the lower occupancy levels which underpin financial viability.”

The Government’s “Winter Plan” has requested an end to all non-essential movement of staff between care homes, resulting in likely adverse operational and cost consequences for some homes. In addition, local authorities were requested to identify homes “that are safe for people leaving hospital who have tested positive for Covid.” These so-called “hot homes” are designed to be separate standalone units. For their stakeholders this means increased risks that will need to be carefully assessed and managed.

In December the Government announced an additional £149m for the sector to speed up care home testing, partly in response to the rise of the more transmissible strain of COVID-19. Staff are now being asked to take rapid tests twice a week, in addition to weekly PCR tests.

Wiles continued: “Despite the short-term pressures, many expect the long-term outlook for the sector to be robust, mostly because of the baby boom generation entering old age. However, smaller independent care homes are likely to remain sensitive to the continued financial impact of lower occupancy rates and the increase in operating costs imposed on them as a result of the pandemic. Financial pressure such as this could lead to reduced investment in staffing, facilities and therefore care, possibly resulting in safeguarding concerns.”

There is no doubt that the operating environment for care homeowners and managers is challenging, but it is possible to protect your business if you act quickly. Care home operators need to turn to experts who can independently assess the position of the business and model various scenarios to provide clarity of the financial needs of the business now and into the future. Advisors can also assess available funding options to mitigate any funding requirements as well as more formal restructuring options should that be necessary.

JPIN VCATS invests £700k leading a £2 million raise for fintech front runner CreditEnable, an AI-driven SME credit marketplace

JPIN Venture Catalysts Ltd (JPIN VCATS) today announces a lead £700k investment into CreditEnable’s pre-series A round. CreditEnable is an AI-driven SME credit marketplace that uses data analytics and AI to support SMEs in procuring different business loans, helping lenders improve approval rates to above 70%. The investment – leading a £2million raise – will be used to continue the development of CreditEnable’s technology platform and expand the firm’s userbase.

Founded by seasoned private equity and debt investor Nadia Sood (CEO & Co-Founder) and veteran early stage investor Varun Sahni (COO & Co-Founder) CreditEnable is headquartered in the UK, and has been operating in India since 2017. The fintech platform provides SMEs with a free and seamless experience by simplifying the otherwise complicated process of getting a business loan. The platform helps them to manage their credit profile and quick delivery of the best loan for their business at the best rates – all at no risk to their credit score. Lenders using the platform benefit from lower costs when facilitating loans in the SME sector, leading to more profitable growth. CreditEnable has more than 20 lender clients, including major financial institutions in India, IDFC First Bank, ICICI, Bajaj and international financial institutions, Deutsche Bank and DBS.

CreditEnable effectively bridges the gap between the SME loan procurement process – a notorious and lengthy one – and optimising solutions to help lenders grow efficiently. In 2020 alone, $4.5 trillion of available financing didn’t get to suitable borrowers, meaning that today’s announcement is bridging a critical deficit that inhibits SME growth. Recognized as “Responsible Digital Innovator of the Year” at the Global SME Finance Awards 2020, CreditEnable is committed to eliminating the bottlenecks in India’s lending landscape. The company previously raised a $5 million Seed Round from investors such as Cris Conde, former CEO Sun Gard, Alter Global and Astia and Floreat.

JPIN VCATS is is the UK arm for Venture Catalysts, building the largest bi-directional UK-India investment and growth corridor for startups. JPIN VCATS brings an end-to-end expertise and support of capital, mentoring, and genuine business network to help investee companies succeed.

Speaking on the investment, Nadia Sood, CEO CreditEnable, said, “We are delighted that JPIN VCATS has decided to back our growth. The COVID pandemic has accelerated the adoption of digitization within financial services. Getting affordable finance into the SME segment at scale is going to be critical to our global economic recovery and we are thrilled to have Venture Catalysts support to help us to scale our reach in India.”

Gaurav Singh, Founder & Managing Partner, JPIN VCATS said, “The UK-India relationship is at an all-time high and this is a perfect testament to how amazing businesses can grow cross-border while making a meaningful impact on GDP by enabling SMEs with quick and affordable finance. CreditEnable is a very high-quality UK startup and is on a fast trajectory to be a market leader globally.”

Nayan Gala, Founder & Managing Partner, JPIN VCATS added, “Fintech is one of the fastest growing sectors in India and a large number of unicorns are expected to emerge in the next decade. $1.47 billion was invested in the first half of 2020, a 60% increase over the corresponding period in 2019. CreditEnable has enormous potential and has built a technology platform that is scalable across multiple geographies. With a team track record of building a unicorn, and having invested in a number of soon to be unicorn companies at their very early stage, we see the same potential in CreditEnable. The firm is well-equipped to optimize resources and solve for the most relevant gaps in the Indian market, especially in the current, pandemic environment when the demand for business loans is expected to increase. With more than 100 years of combined experience of the founding team, the company has both a strong vision and unmatched skills required for raising the bar even higher. We hope that the funding will help bolster the team’s business vision and empower them to achieve continued success.”

Nucleus Commercial Finance secures £200m in new funding to support SMEs in 2021

Nucleus Commercial Finance, the award-winning fintech lender, today announces a new £200 million funding line from two leading global investment management firms.

This funding line will further increase Nucleus’ capacity to support more businesses across the UK, ensuring the lender is positioned to continue its support for SMEs once the Government’s Coronavirus Business Interruption Loan Scheme (CBILS) comes to an end in March.

Nucleus has ambitious plans to deliver this vital funding to businesses through existing solutions and a number of new, flexible products. These new products will come to market during 2021 and respond to the range of financial needs SMEs have right now to support jobs and safeguard their futures.

Supported by its award-winning technology platform myNucleus, as well as its automated underwriting solution, Nucleus will be able to work with more SMEs across all sectors and sizes, providing quick decisions along with the finance they need to operate in a challenging business environment.

Nucleus has lent over £1.7bn to thousands of UK businesses since launch in 2011 and has played a critical role in providing finance to businesses through CBILS. Since becoming an accredited lender, Nucleus has processed over 8,000 applications, supporting businesses employing more than 40,000 people collectively in the UK. Nucleus recently announced its ambition to lend a total of £200 million through the scheme before 30 March 2021.

Nucleus Commercial Finance CEO, Chirag Shah, said: “Once the government loan schemes come to an end later this year there will be a significant funding gap in the UK. This is where Nucleus, as a fintech lender, will continue to play a vital role to bridge this gap and support businesses by providing the finance they need.

“Securing a facility of this size from two leading investment management firms is a big vote of confidence in our ability to originate, underwrite and service UK SMEs. It ensures we are ready to help SMEs and reinforces the role that fintech lenders are playing in the industry. SMEs are now turning to alternative and fintech lenders as the first point of call due to our innovative solutions and ability to provide funds faster than high street banks. The new funding line will further accelerate this trend and cement our position as the leading fintech for SME finance.”

Together appoints new account manager for the North

Specialist lender Together has hired a highly-experienced industry professional as a regional account manager for the North.

James Briggs, who has worked in the specialist market for more than two decades, brings a wealth of knowledge of the industry to his new role, which begins this week.

Previously, he has held senior positions for specialist finance companies including national account manager, head of business development and specialist distribution manager.

James has had held the roles of operations manager for a specialist distributer and started his career as a mortgage adviser for a high street bank, giving him valuable experience “on both sides of the fence”, said the married dad-of-one.

He said he was looking forward to forging strong relationships with intermediaries across the North of England and Scotland – to make a valuable contribution to Together’s continued growth, despite major challenges facing the industry because of the Covid pandemic.

James said: “All businesses in our sector had a hugely challenging 2020 but what particularly impressed me about Together is how the business also turned these challenges into an opportunity; investing in technology to boost efficiency, while maintaining its common sense approach, which has resulted in an even better service to its partners.

“Together truly appreciates the value of relationships with packagers in the specialist space and I’m excited to start working closely with partner firms to help identify growth opportunities, provide support and win business.”

This week, the lender announced in a trading update that average monthly loan originations were £74.4 million in the three months to December – up 70 per cent on the previous quarter.

Sundeep Patel, head of intermediary sales at Together, said James’s knowledge, relationships and expertise would build on this success, helping Together to realise its future growth plans.

He said: “James is well-respected and a big name in the specialist lending industry and we’re delighted to welcome him to our business at what is an exciting time for us. His CV speaks for itself and we’re looking forward to his undoubtedly important contribution to Together as we move into 2021 and beyond.”

Permanent TSB partners with Experian’s categorisation service to deliver enhanced customer lending journeys

Irish personal finance provider Permanent TSB has signed up to use Experian’s banking categorisation technology to improve its customer lending journeys.

When a customer applies for a loan, Experian’s Categorisation as a Service (CaaS) automatically categorises the customer’s income and expenditure to allow lenders to quickly understand a person’s financial situation, ensure a robust lending decision and enhance the speed to a decision in the customer journey.

The solution produces high levels of accuracy, so Permanent TSB can treat customers fairly and deliver improved outcomes. The categorisation engine is an Irish-specific version and is the first in the market within the Republic of Ireland. It complements Experian’s UK version, but it can also recognise local country transactions and retailers following extensive training and development.

Categorised data will deliver an improved customer experience and serve people faster compared to traditional processes. The service will work across all product lines, including personal financial management. Financial wellbeing has never been more important, and categorisation will support the creation of many new products which leverage the data.

Experian’s Martin Hagerty said: “Financial providers have always sought to understand a person’s track record, their willingness to pay and their ability to pay. For many years, credit bureau data has helped answer two of these questions and now this service will help lenders to truly understand affordability.

“Categorising income and expenditure will allow lenders to see whether a person’s income is stable or indeed has fallen significantly, or if their burden of non-discretionary spending is beginning to become a problem for them. We’re pleased to be working with Permanent TSB so they can continue to make high-quality decisions on affordability at an improved speed.”

Mike Frawley, Chief Risk Officer at Permanent TSB, said: “This partnership with Experian builds on the bank’s digital focus, offers our customers quicker response times and enhances our automated lending journeys.”

SFP launches Guide to Business Survival to support small businesses

SFP, the restructuring and turnaround group, has published a new free Guide to Business Survival with easy to follow practical steps which includes a number of remedies to support small businesses navigate through the current crisis.

The Guide to Business Survival is set up in three clear stages of keeping or getting a business back on track. Part One explores the steps a business can take without having to resort to borrowing, and the importance of a cashflow forecast in understanding your true financial position; if the company is in need of cash, Part Two of the Guide outlines the various different funding options available, both short-term lending schemes to help businesses ‘bounce back’ from the current crisis as well funding solutions for more longer-term planning.

Part Three of the Guide goes on to explore the restructuring and Insolvency processes, and how there are still ways of giving a business and its employees a future. It explains each element of the Insolvency regime, and the differences between Company Voluntary Arrangements (CVAs) and Creditor Voluntary Liquidations (CVLs), for example, through a series of helpful questions and answers.

There is also guidance throughout on how to negotiate with creditors and HMRC with both formal and informal ‘Time to Pay’ arrangements, and how to choose a broker to help better understand the myriad of funding options available.

Simon Plant, Chief Executive of the SFP Group, says that running a business can be tough, even when things are going well: “Many businesses fail, not because they don’t have a great product or service, or even a full order book, but more often because they’ve spent too much time ‘doing the day job’ and not enough time focusing on the cash,” he explains.

“Throw in a global pandemic,” he says, “and that challenge is taken to another level. The Government has responded quickly and decisively to help small businesses with a variety of employer and employee support programmes and funding packages, and with tax breaks and payment holidays. But such support cannot go on indefinitely.

“With the furlough scheme giving way to a Job Support Scheme, repayments of loans falling due, and deferred payments no longer deferred, businesses are facing a series of ‘pinch points’ that will undoubtedly impact their cash flow and their future prospects.

“Our Guide equips them with the information and steps they need to navigate their way through this current crisis, or how best to restructure their business with the help of a licensed Insolvency Practitioner.”

Throughout the guide, SFP focuses on the positive actions a business and its directors can take to recover and return to profit. It also explores a director’s fiduciary responsibilities, especially in an insolvency process, and spells out the financial and personal consequences of failing to act quickly and responsibly.