Invoice finance is a growing part of the UK small business landscape, especially when banks are failing to lend to those SMEs who need extra finance. Recent data has shown that this looks set to grow, especially in some sectors of the UK market. Trends have shown that the construction and manufacturing sectors are predicted to see the largest increase in the use of invoice finance this year.
The invoice finance industry looks set to grow throughout 2013, according to trend data from the UK’s biggest invoice finance broker Touch Financial. This has shown which sectors are going to make the most of alternative finance to overcome the problems created by low bank lending.
Data from the past five years has revealed those sectors that have experienced the most growth in their use of invoice finance. These were ranked as follows:
1) Construction: 138.46% growth over 5 years
2) Manufacturing: 120% growth over 5 years
3) Healthcare / Care Services: 50% growth over 5 years
4) Professional: 50% growth over 5 years
5) Security services: 33.33% growth over 5 years
The past 5 years has seen a great increase in the number of applications for invoice finance, as more and more businesses discover the advantages of looking outside of the banks. Many businesses benefit from taking the strain of payment collection away from their shoulders through undertaking a structured factoring plan, where collection is taken over by the lender. The benefits of collecting payment almost as soon as invoices are released are also a big part of why so many businesses are taking advantage of it. These increases in the use of invoice finance look set to continue throughout 2013, with sectors such as construction, contractual and manufacturing topping the ranks.