up opportunity Merchant Money

Fostering a deeper understanding

Working together toward success in a post-pandemic landscape

Thomas Shave Director of Broker and Intermediary Sales Merchant Money

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s lockdown measures ease and the UK economy reawakens, the challenge of successfully supporting theSME market will be one best faced together.

UK SMEs have been significantly impacted by the pandemic, and lenders have not been an exception. Many were forced to take a risk-adverse approach by wholesale funders, halting new business and tightening underwriting. Yet, following recent Bank of England announcements, more lenders are growing in confidence. The forecasted ‘V-shaped’ recovery paired with government-driven economic initiatives has meant that many are actively looking for opportunities to deploy capital once again.

Merchant Money, as a Patron of the NACFB, is single-minded in doing what is best for introducers and their clients. This commitment saw us launch CBILS term loans to both our existing book and new business, whilst remaining flexible in our approach to traditional funding.

Communication is king

In the post-pandemic landscape, communication is king. The demand for flexible and tailored finance will inevitably increase, as businesses find their feet and their path back to growth.

As such, the provision of ongoing support is essential. Building strong relationships with both client and lender is key. In the past, lenders may have been guilty of relying too heavily on portals and collateral to provide information to introducers. Email is an essential but often over-used tool that lacks the immediacy required to best support customers. Now is the time for change. With market adjustments occurring sometimes daily and more clients falling into the ‘non-vanilla’ bracket, conversations are required.

Although video conferencing is likely to continue to largely replace traditional face-to-face meetings in the short term, this can be embraced as a benefit to increase efficiency. Two-way conversations build relationships and discussing applications over phone or video call will speed up processes and aid in bringing about transparency.

Streamlining processes

Conversations will be vital but will be of limited use if not streamlined. They should be viewed like any automated or set application process, with both lender and introducer outlining response times and remaining consistent with them.

Once the pandemic subsides, client confidence will be hugely important and working together to limit any detrimental impact to

“Once the pandemic subsides, client confidence will be hugely important and working together to limit any detrimental impact to relationships is essential

relationships is essential. Now is the time to lean on lenders for their expertise and dig deeper than just the application. Getting involved in conversations with lenders earlier in the process, by discussing funding suitability prior to application, will increase efficiency and better maintain those important relationships.

As Merchant Money prides itself on its level of flexibility we have been urging our introducers to pick up the phone to discuss business before applications are submitted. This way we can work together proactively to find a funding solution.

To ensure introducers can continue to best support their clients, a clear understanding of each lender’s application process and requirements are needed to successfully streamline processes. Understanding timescales and requirements for final information requests for example will enable lenders to make decisions promptly.

Nurturing collaboration

Introducers need to be comfortable sending applications to lenders. A level of understanding and trust is required to give confidence that such business will not be turned away. Lenders too, need to be consistent in their approach to ensure opportunities are not missed.

Introducers should look to lenders for their expertise to gain a deeper understanding of each lender’s processes and the rationale behind further information request or final decisions.

There is no room for blind decisions in the post-pandemic 'new normal' and lenders should be prepared and willing to talk through decisions with introducers. Fully understanding the rationale for a decline will enable introducers to give their clients the insight they require and deserve. In doing so, they will be better able to maintain client relationships and be one step ahead in preparing for future ones.

A declined application for example, should be viewed as a learning opportunity to increase consistency, confidence, and efficiency.

“There is no room for blind decisions in the post-pandemic ‘new normal’ and lenders should be prepared and willing to talk through decisions with introducers

Strengthening relationships

Conversations, accountability in responses and a deeper understanding of each other’s business will only help to strengthen introducer-lender relationships. Whilst transparency and consistency throughout the application process will reassure introducer and client confidence.

Challenging times often fuel innovation and strong relationships between both lender and introducer will help drive the right solutions in a changing SME landscape. The path and pace of the new normal will be dependent on the UK’s success in bolstering confidence and containing the virus, allowing funding to be driven once again, for growth as opposed to survival.

A measured approach combined with transparency and strong introducer-lender relationships is required to rise to the challenge.