How to recognise a dependable broker

As an SME business owner, one of the trickier topics that you will need to master is managing your cash. A key lesson of COVID-19 and beyond for us all was that having cash is always a good thing.

If you’ve got cash, how do you look after it? And if you’re waiting for people to pay you, how can you speed up that process? A good finance broker can help with both issues.

If you’re buying any piece of capital equipment like a lathe or a van, or refitting an office or warehouse, then borrowing the money with asset finance and repaying it over an agreed period may be a better plan than spending your hard-earned cash. With invoice financing, you can receive immediate payment of the invoices that you raise, so you’re not waiting 30-60 days for payment.

Both asset finance and invoice financing help protect your cash position, and a good finance broker will be able to help you identify when these are appropriate finance solutions.

But how can you tell a good broker from a bad one? Certainly not by search engine rankings or paid advertisements, and you may not have the knowledge or headspace to spend time ploughing through anonymous online reviews. You can speak to your high street bank manager, but this may not be the best solution.

This key dilemma has now been addressed by a group of independent finance brokers who have founded the Guild of Business Finance Professionals. All members must be recommended by their peers and vetted by the Guild Board, mandating that they follow the guidelines to promote best practice. One of the Guild’s core aims is to protect lenders and borrowers by providing a mark of professionalism.

Borrowing money can be a daunting prospect for a business owner not familiar with the process. You’ll be sharing confidential information about your business with a stranger, so how do you know you’ll be getting the most suitable guidance? Look for the Guild logo and this will significantly improve your chances of finding an experienced and trustworthy professional to manage the process for you.