What Is Missing From The Invoice Finance Market?
Recent invoice finance industry figures have shown positive signs of growth in terms of the volume of business transacted by clients, although the growth in actual client numbers has been minimal. The various factoring and invoice discounting providers are all competing to grow their relative market shares so this led us to question where the gaps are within the invoice finance market that could be addressed by providers that are looking to accelerate their growth.
We selected a sample of 100 SMEs (Small and Medium Sized Enterprises) and we asked them a simple question - "What is missing from the invoice finance market?".
The answers that they gave were as follows:
- 31% Flexibility
- 28% Instant online setup and approval
- 14% Advertising
- 12% General awareness of what invoice finance is
- 6% Ease of use
- 4% A well known, highly thought of provider
- 2% Personal service
- 1% Money
- 1% Adequate credit limits
- 1% A comparison site
We questioned these businesses further regarding what they meant by "flexibility" and in all cases they were referring to the need for additional flexibility in terms of funding, beyond that which presently exists. Clearly, whilst invoice finance already represents a more flexible form of funding than more traditional methods, there is someway to go in order to meet customer requirements when nearly a third of respondents feel this way.
The second highest response was the requirement for "instant online setup and approval". These results appear to corroborate anecdotal evidence that some businesses are now more comfortable with the concept of signing up for finance products online.
Lastly, combining those that responded "advertising" with those that responded "general awareness of what invoice finance is" constitutes 25% of the total number of respondents. This continues to evidence the need for greater promotion of invoice finance as a cash flow solution.
