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The danger of bad advice

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Last week I heard a familiar tale.

A recruitment company has just signed up to an invoice financing deal and quickly found that they are being hit with all sorts of charges as well as being unable to draw down sufficient cash due to restrictions 

They were placed with this lender because their accountant informed them that he had a “special relationship”. 

Yes really.

The special relationship is of course nothing more than the fact he gets commission without having to do the legwork to explore the market. No doubt he gets a few nice days out too

There are 40 or so lenders in the invoice financing market. They vary enormously on terms and facilities. Maybe this accountant can do some maths

The maths are? The chances of his client getting the best possible deal is one in forty. Or 2.5% 

The client is stuffed and the accountant has received commission for frankly doing very little. I would also suggest that his ability to negotiate and find the best solution would be minimal. 

That takes time and resources as well as a constant exposure to an ever shifting market. Its also enjoyable too. Finding a real solution for a borrower is very satisfying.

And yes that is my role

But if you were this client what would you be thinking? If you knew? 

And where would you tell the accountant to go?

 

 

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