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The glass is half full

The COVID crisis has driven greater efficiencies and outcomes

Ric Simmons Sales Director Praetura Asset Finance

Without doubt, the last few months have been unlike anything that any of us have experienced before. There have been challenges and a necessity for a whole host of changes to be made. But there is a lot we can learn from these experiences. Many of the changes we have had to make will form the foundations to how the asset finance industry evolves.

At Praetura, along with everyone else, we had to adapt to a new way of working very quickly when we closed our office doors back in March. We were fortunate to have previously invested heavily in our systems and technology, so the transition to all our staff working from home was a relatively smooth one. But other challenges presented themselves, with a raft of payment holiday requests and team members needing to be seconded from other departments to help these be processed.

Not just where we work, but the whole ethos of how we operate has had to change too. Amends to credit policies were made swiftly so that we could accept virtual assets inspections, documents could be witnessed on video calls and scanned versions of agreements became the new norm. Fortunately, we have never had to walk away from a deal because of the government enforced restrictions, we have always found a way.

Consultancy is key

Praetura was founded on the principles of a flexible client-focussed approach to lending. As a way of working, for the asset finance industry as a whole, this is going to become more prevalent as we move forward.

We already know that no two businesses are the same. But also, no two businesses have been affected by the coronavirus pandemic in the same way. There have been different issues to face and obstacles to overcome for each individual company. Our industry’s approach to lending must reflect that. We must also take the time to understand the situation of each client, looking at the ‘whole picture’ and not just an individual immediate requirement. It is on this that our decisions should be based.

Rebuild with refinance

I have no doubt in my mind that asset refinance will become a more widely used funding tool over the coming months. In recent years we have seen the popularity of these facilities increase and I would fully expect that to continue. We might see an increased nervousness around the unsecured loan market as a way of providing an immediate injection of working capital into a business. Asset refinance is a way to make this happen with much less risk attached to it.

An efficiency evolution?

Many of the changes we had to make quickly at the beginning of this, will stay with us. This will help make our industry more flexible and more customer-focussed than ever before.

We are going to be more efficient with our time. We are going to take advantage of the range of options that technology makes possible; there will be less face-to-face meetings, but more video conference calls, we may continue to use virtual asset inspections as an option available to us and video recorded witnessing of documents too. This area of our industry will continue to adapt and develop as time moves on.

Relationships matter

The role of a broker for an increased number of SMEs will take on a much greater significance. The importance of the role of intermediary advice will become more necessary and more widely used, to ensure SMEs are fully aware of the range of finance options that are available to them. There may be a need for some advisers to diversify into different sectors and increase the range of services they can offer their clients. If help and assistance is needed to find out more about hard asset funding, refinance or the benefits of working in partnership with a consultant lender, the team at Praetura Asset Finance are a resource I would want to actively encourage you to use.

I am convinced that the asset finance industry will emerge from this stronger than ever before. We will adapt, we will move on and we will grow – both in terms of the support that we are able to offer SMEs and the funding we are able to provide.

“Many of the changes we had to make quickly at the beginning of this, will stay with us. This will help make our industry more flexible and more customer-focussed than ever before