Home > Uncategorized > “Alternative finance” Is it that easy?

“Alternative finance” Is it that easy?

As you may be aware, next year brings in legislation compelling banks to refer clients rejected for credit, to “alternative finance” platforms.

I think this is an absolute joke.

I regularly use “alternative platforms” and have very good relationships with the significant players in the market. They are a breath of fresh air and much needed competition  for the existing lenders but they are far from being the only solution. Furthermore they more often than not charge much higher rates than traditional lenders

As I understand this, the underlying assumption is that if say HSBC reject your application for credit then Barclays or a second tier lender like Aldermore will too. This is complete nonsense

Furthermore there is the prevailing view that lending can simply be completed on line. This may well be the case for straightforward loans but is certainly not usually feasible for a revolving facility and long term crucial relationship

Naturally as a broker my comments could be interpreted as being influenced by my role but when I see that 71% of smes only contact one lender when seeking finance and knowing the huge variation within what is an increasingly widespread market I am also bound to say that there is clearly a need for strong specialist advice rather than online form filling

 

 

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