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Why change provider?

A recent survey conducted by a firm of brokers in the invoice finance market has produced some very interesting results. Not least because my eyebrows were raised

They apparently asked a large number of borrowers why they had changed providers

The results were varied but there were a couple of surprises

46% changed because of “price”
7% because of service

In addition there was no category for those that moved because they simply couldn’t make maximum use of the facility. ie restrictions

in my experience, relatively few borrowers actually move on price alone. Simply put, the margins often don notjustify the risk. I have advised against moves for a minimal savings where the service is fine

A large number of enquiries may be on price but that is a different matter. These enquiries have a very low conversion rate

Service is different. Its a loss of confidence and whilst a price can be adjusted, promised improvements in service are far more difficult to nail down. For obvious reasons

And the facility? Lenders vary enormously as to their appetite for lending against certain debtors and markets. Advance rates vary as do concentration limits. This is a big driver for moving accounts

To not see it highlighted as a factor is very surprising indeed

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