Short-term funding options to support cash flow in uncertain times


This article was updated on 20/03/2020.

The cash flow pressure and uncertainty being caused by COVID-19 is already impacting businesses across the UK.

Businesses have been forced to invest in protective measures in order to make their company COVID-19 ready, by stockpiling necessary supplies and materials and/or purchasing additional equipment to facilitate home working.

Combined with the growing threat of late payments, with some companies in difficult positions delaying payments to suppliers, the cash flow of many businesses is already starting to be affected and the level of severity is likely to increase over the next few weeks and months, as things continue to develop.

So what funding options are available to help businesses manage any immediate or temporary cash flow issues?

Targeted cash flow support

Lenders are ramping up their support to British businesses in a bid to help them navigate the cash flow pressure and uncertainty being caused by COVID-19.

Some have announced that arrangement and review fees will be waived on new or increased overdrafts, while similar support is available from some invoice finance providers to support businesses during these turbulent times.

Plus, in last week’s Budget, the government announced a new Coronavirus Business Interruption Loan Scheme that will see eligible businesses able to apply for loans of up to £5 million to minimise the disruption caused by the virus, with no interest due for the first 12 months.

There is already a range of finance facilities and options available, which are designed specifically to improve businesses’ cash flows and could be more suitable.

Here are just a few:

Invoice finance

Invoice finance enables businesses to release funds against the value of unpaid invoices.

Up to 90% of an invoice’s value is advanced by the lender within 24 hours of its issue, with the remainder, less the funder’s fees, transferred once payment is received from the customer.

This gives businesses access to funding to use as they wish and is based on freeing up cash that’s tied up in the ledger as a result of trading on credit terms. The capital available can be used to pay suppliers, staff, utility bills, mortgage payments and other running costs.

There is a wide range of options available, and facilities can be structured to suit a variety of businesses and requirements. For example, some may only need to raise funds against a portion of their invoices – perhaps those of a particularly high value or supplied on longer credit terms.

Get an instant invoice finance quote using the tool below:

Business loans

Business loans provide flexible and quick access to money that can be used for any business purpose and can be a good option even if your business has no fundable assets.

It’s also possible to get fixed interest rates so that you will know the exact value of repayments throughout the loan period, allowing you to better manage your cash flow.

Download our ultimate guide to business loans

Longer term options

Some businesses may prefer to have the assurance a longer term facility can provide. If this is the case for your business, there are facilities that could release funds and provide a mid to longer-term solution.

Sale and leaseback

Sale and leaseback allows businesses to release funding against commercial property to boost cash flow.

Essentially, a funder buys your commercial property and then leases it back to you, allowing you to use the capital that was previously tied up in the property.

The lease will give you use of the property for a pre-determined time period in return for fixed monthly rental payments, meaning you can continue to run your business in a space that you already know works for you and avoid the need to sell to access the cash that’s tied up.

Discover more about the benefits of sale and leaseback

Asset refinance

Similarly, if you have money tied up in other assets, such as plant and machinery, you may want to consider asset refinancing to boost your cash flow.

This involves selling your assets to a finance provider and then leasing it back from them in return for fixed payments.

This can help you manage your cash flow and can also protect your company from asset depreciation.

Read more about asset refinance here

How do I know which option is best for my business?

Finding the most suitable solution for your business’s particular needs can be both challenging and time consuming at the best of times, and especially given the fast changing current environment.

Our team are keeping their fingers on the pulse with evolving underwriting criteria and facilities to ensure we remain best placed to deliver our usual high standard of service to businesses as a commercial finance broker, making the process as straightforward and quick as possible while delivering the right fit in terms of the amount, level of service and cost of the funding.

We would urge businesses foreseeing a requirement for additional cash to act promptly as, although turnaround times in the industry are currently fast, given demand is rising we expect the decision-making process and therefore the availability of cash to soon take longer than usual.

To discuss any funding requirements or cash flow challenges you may have at this extraordinary time, please call our team on 0800 9774833 or request a call back.


Some of the funders we work with

  • Time Finance
  • Aldermore Invoice Finance
  • PNC Business Credit
  • Metro Bank SME Finance
  • Santander Corporate & Commercial
  • MaxCap
  • Davenham Trade Finance
  • Lloyds Bank Commercial Finance
  • 4Syte
  • Nationwide Finance
  • Sonovate
  • Investec
  • Giant
  • Roma Finance
  • Optimum Finance
  • Blazehill Capital
  • Praetura Invoice Finance
  • Team Factors
  • Partnership Invoice Finance
  • Royal Bank of Scotland
  • Clear Factor
  • Kriya
  • Cynergy Business Finance
  • Close Brothers Invoice Finance
  • Pulse Cashflow Finance
  • InvoCap
  • Woodsford Tradebridge
  • Peak Cashflow
  • Accelerated Payments
  • IGF Invoice Finance
  • Haydock Finance Ltd
  • Davenham Asset Finance
  • Skipton Business Finance
  • Castlebridge
  • eCapital Commercial Finance
  • Berkeley Trade Finance Ltd
  • ABN AMRO Commercial Finance
  • Tradeplus24
  • Ultimate Finance Group
  • Regency Factors
  • Barclays
  • Merchant Money
  • Leumi ABL

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We are a credit broker and not a lender and offer credit facilities from a panel of lenders