What is a Commercial Finance Broker?
A commercial finance broker is an individual or company that specialises in helping businesses find the most suitable finance. They act as the intermediary, or middleman, between those businesses seeking finance and the broad array of lenders that are now in the market. Many brokers are independent, which means that they act impartially on your behalf to ensure they find you the most suitable funding solution and are not tied to any particular lender.
In 2019 alone, brokers helped 227,000+ UK businesses to access finance totalling £14.9 billion – a huge contribution to the SME market, which forms the backbone of the economy. Brokers are most beneficial to those UK businesses who need or want guidance on finding the most appropriate business finance and want to cut through the corporate jargon typically associated with lending. Sound like you?
So, your business may be looking for finance. Why is working with a finance broker the best option?
5 Reasons to Use a Finance Broker:
1. Personal Approach
From initial enquiry until completion of the deal and contract signing, a broker will be with you every step of the way. They will take the time to truly understand your business’ unique situation and stay clear of the typical one-size-fits-all approach taken by many banks in the UK. Fora broker, the devil is in the detail. Many brokers have years of experience in financial services and are therefore accustomed to navigating the often complex and confusing waters of the industry. Getting to know you and your business is their main priority.
2. Shop Around for You
For a business owner, running your business is always top of mind. While finance may be necessary to your business’ survival or growth, it shouldn’t have to jump the queue in terms of priority. This is where a broker’s value becomes evident. Once you have communicated your needs with the broker, your work is done. They will do the rest of the leg work for you and communicate with their panel of lenders, saving you the time and hassle of searching yourself. Brokers are on your side and will work tirelessly to show lenders that your business is worthy of funding.
3. ‘Whole of Market’ Coverage
60% of businesses who search for finance give up after getting turned down by the first lender. This is hindering thousands of businesses across the UK from accessing alternative finance options that their business may be viable for. Luckily, a broker will assess options from the whole of the market giving your business the best chance of not only finding finance but finding the best deal.
4. Save Time & Money
Finding a business loan can be a long and tiresome process of communicating information with multiple lenders, each with differing criteria, but the same boring and repetitive digital or paper form. It’s safe to say that ‘customer experience’ is not something many major banks pride themselves on.Online comparison platforms, built to give consumers the opportunity to find the best deal, typically offer very little transparency or education in relation to interest rates. Brokers will not only save your business time by doing the searching for you, but they will often be able to secure your business a better interest rate because of their strong relationships directly with the lender.
5. Transparency & Clarity
Navigating the business funding market is no easy task with very little standardisation of information, misaligned incentives and lax regulation. Working with a broker will ease this burden as they are on hand to give straightforward answers to your complex questions, providing transparency and clarity. Finding a business loan can and does have a major impact on financial health and should be treated with the same level of care as any other financial decision. Brokers will offer reassurance and act in the best interest of your business.
Using a Broker vs Going It Alone
You may still be thinking, “why don’t I just search the market myself? I’d rather not speak to someone” Well, that’s a perfectly reasonable thought. There are comparison sites a plenty, lots of online lenders- I’ll just search the internet.
Finding finance through a broker may not be for everyone, as many businesses prefer a ‘hands off’ approach, or generally understand how to manage the process. The purpose of this blog is simply to educate SMEs across the UK that there are options outside of generic comparison sites and inefficient bank processes. Every business is unique and deserves to be treated as such. This is where a broker’s skill set truly thrives.
A recent study from the British Business Bank found that businesses accessing external support when looking for funding are more likely to become high-growth companies.
Do you want your business to be one of them?
350+ Brokers in the UK✅
No impact on your credit score✅
Free, no commitment✅