Small and medium-sized enterprises (SMEs) in the UK account for over 99% of private sector firms, and in 2017, they employed some 16 million people—or roughly a quarter of the country’s population.

What’s more? According to FSB’s Small Business Statistics, they’ve also plugged in a combined annual turnover of £2 trillion.

Yes, £2 trillion.

Yet despite being the country’s primary job creators and positively contributing to the UK’s GDP, access to capital remains a major challenge for many entrepreneurs looking to grow and expand their business.

According to SME Web, high street banks convert only 8% of small business loan applications. “Due to regulation, due to banks having huge cost structures, due to SMEs not having standardised data, there’s quite a big funding gap,” says Code Investing CEO Ayan Mitra.

Financial institutions are cautious about lending to SMEs, and it’s especially difficult for younger companies who don’t have several years of financial statements to support a loan request.

Alternative options

Being turned down can be discouraging, but thanks to alternative finance providers like Merchant Money, the wheel of fortune is beginning to turn in SMEs’ favour.

“Just because other lenders or banks do not have the appetite to help small business owners does not mean they should be excluded from finance,” notes Jonathan Stern, Director and Head of Credit at Merchant Money.

With a robust loan offering that is fast and flexible, Merchant Money is successfully breaking barriers in the small business economy.

4 reasons SMEs should consider alternative funding

Less red tape

In the current landscape, new businesses or directors who don’t have the cleanest credit will struggle to qualify for a loan, let alone be approved for one. And then, even if they do meet the prerequisites, they still have a series of admin and checks that can backfire at any step of the inquiry.

Because alternative lenders aren’t bound by the same legislation, their borrowing criteria is far smoother and simpler. “At Merchant Money, we do not underwrite using a scorecard; our personal approach allows us to fund businesses that might not get approved elsewhere,” says Stern.

Flexible

When it comes to SME lending, Merchant Money believes that there is no one-size-fits all solution. Each business is unique and requires a custom offering that is adaptable and specifically tailored to its needs.

And while they don’t insist on detailed business plans, they do request a bit of your time to get to know you and your business.

Dezzi McCausland, owner of McQueen Shoreditch, an award-winning cocktail bar in Shoreditch, London, sings the company’s praise: ‘’Merchant Money’s decision makers came and visited me at one of my premises, so I had the opportunity to explain my plans in detail.

“Having one-on-one personal contact with people who treat you with respect, and who actually look at every possible angle to secure funding, was most definitely a very big change from mainstream lenders.’’

Danny Girnun, Managing Director of Merchant Money reiterates their nurturing approach: “Over the past few years, we have invested significantly in customer service, improving processes and product diversification. We have launched new products to meet our clients’ needs, and we have grown the Merchant Money team. We are achieving our goal of becoming a client-centric business. We will continue to invest in those areas that will allow us to grow even more

Bespoke pricing and product structures

In addition to offering loans of up to £500, 000 without loan-to-value (LTV) restriction, Merchant Money is also recognised for its innovative Business Cash Advance.

This product, also known as a Merchant Cash Advance, is not repaid via fixed monthly instalments. Instead, a small percentage of future card transactions is automatically debited via businesses’ PDQ machines.

“The fact that we offer a variety of products – we just launched a new secured loan product – in combination with our personal approach, has allowed us to lend into most sectors across the UK SME space. We are not just limited to specific industries, adds Stern.

24 Hour approval

Forget a long, tedious wait. When it comes to fast finance, Merchant Money combines their personal evaluations with advanced risk assessment technology.

The loan application takes a matter of minutes and once received, they guarantee a 24-hour approval, with funds available within two hours.

To date, Merchant Money has lent over £50, 000, 000 to promising small businesses in the UK.

“Over the coming years, there will be some uncertainty for SMEs in the UK. There is a need for businesses like Merchant Money who can provide continuous support. We’re agile, flexible and commercial in the way that we underwrite. Our mission for the future is to continue offering small businesses the support they deserve,” says Girnun.