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Alternative finance key to the future of British small business expansion
April 04, 2018
London, 4th April 2018 – Alternative finance holds the key to funding expansion for many British small businesses, as access to funds from traditional lenders remains restricted. According to a recent survey of 1,000 small business owners, almost one in three reported difficulties in securing business loans from banks, potentially halting their expansion plans1.
To help address this issue, Worldpay has announced a three year extension of its popular Business Finance scheme, aimed at helping over 300,000 British small businesses access alternative financing by enabling access to a “cash advance” based on their future credit and debit card sales. The scheme, launched in 2015 in partnership with Liberis, a leading provider of cash advances to small businesses, has already provided funding in excess of £50 million to UK SMEs. Under the scheme, funds can be made available to businesses in as little as 72 hours.
Chris Andrews, proprietor of Blacks Cheese, is one business owner who has utilised Worldpay Business Finance to help address stock purchasing needs.
“Worldpay Business Finance became apparent as an alternative method of funding the business, at a time when we needed it instantly and it was delivered within a matter of hours. Worldpay is now part of our financial reckoning, and it'll be one of our tools that we'll always use and it's not going to be something that we need to consider. We know how it works, we know how it funds us - it's paid off for us.”
Alternative finance, while available to all types of small business, is proving particularly popular with start-ups. Worldpay’s research revealed that businesses under five years old are as likely to select alternative finance methods to secure capital as approaching banks. Analysis by Worldpay of how these funds are used reveals that in 2017, direct investment in businesses, including stock purchase, expansion & refurbishment funds and equipment purchases drove 87 per cent of the cash advances.
Despite its growing popularity, the research also revealed that business cash advances are among the least known forms of funding, with only 2 percent of businesses indicating an intention to use this form of finance in 2018. At the same time, business owners aged under 35 indicated they are more likely to place their confidence in alternative financing as a way to reduce their reliance on banks, with 40 percent stating its emergence will make things easier. With the extension of the Business Finance scheme, Worldpay and Liberis will work to address this lack of awareness.
“Steve Newton, Executive Vice President, UK and Europe Worldpay said: “Worldpay Business Finance has proven extremely popular with small businesses looking for alternative methods of finance. Worldpay Business Finance was created specifically with the unique needs and structure of small businesses in mind – it’s flexible and it’s fast.
“In 2017, we tripled funding for growth to UK SME businesses and have now advanced over £40million - but we know that this form of funding has the potential to help thousands more. So over the next year, we’ll make it easier to access the scheme by increasing call centre and online support to enable Britain’s small businesses to thrive.”
Rob Straathof, CEO at Liberis said: “SMEs contribute more than £200bn a year to the UK economy; and as this is only set to increase, access to funding is certain to remain integral to their growth. As such, we’re delighted to be continuing our partnership with Worldpay, as Worldpay Business Finance, enabling us to help even more small businesses in the future. Enhancing this opportunity, we will be prioritising education and collaboration to successfully secure the livelihoods of small UK businesses.”
ABOUT WORLDPAY, INC.
Worldpay, Inc. (NYSE: WP; LSE: WPY) is a leading payments provider with unique capability to power global integrated omni-commerce, any payment, anywhere. With industry-leading scale and an unmatched integrated technology platform, Worldpay offers clients a comprehensive suite of products and services globally, delivered through a single provider.
Annually, Worldpay processes over 40 billion transactions through more than 300 payment types across 146 countries and 126 currencies. The company’s growth strategy includes expanding into high-growth markets, verticals and customer segments, including global eCommerce, Integrated Payments and B2B.
Worldpay, Inc. was formed in 2018 through the combination of the No. 1 merchant acquirers in the U.S. and the U.K., Vantiv, Inc. and Worldpay Group plc. Worldpay, Inc. trades on the NYSE as “WP” and the London Stock Exchange as “WPY.”
Visit us at www.worldpay.com
Liberis is a leading alternative finance provider, offering simple, flexible and transparent funding to help UK SMEs achieve their ambitions.
Through its Business Cash Advance, an innovative form of funding, Liberis links repayments directly to cash flow so businesses only repay when their customers pay them.
Liberis is backed by the UK Government owned British Business Bank and is part of Blenheim Chalcot, the UK’s leading venture builder.
To date Liberis has helped over 6,000 SMEs, advanced £210m in funding through Business Cash Advance 2 and supported over 35,000 jobs in the UK3.
For more information, please visit www.liberis.co.uk
Social media channels: Facebook: @LiberisUK Twitter: @LiberisUK
1Research conducted by YouGov of 1,095 senior decision makers across UK small businesses on behalf of Worldpay, October 2017
2 Between 2007-2018
3 Since 2007