In the world of business finance, securing funding can be a minefield—especially for businesses with poorly rated debtors or operating in industries traditionally considered "high risk." Many financial institutions and lenders shy away from these cases, leaving businesses in the lurch, struggling to access the cash flow they need to thrive or even survive.
This is where Fiskal, an independent commercial brokerage, has stepped in as a game-changer. We specialise in finding tailored funding solutions, including invoice finance facilities, for businesses that might otherwise be considered too difficult or risky by mainstream financiers. But how exactly do we do it, and why has our approach proven so effective? Let’s explore.
The Invoice Finance Challenge
Invoice finance is an essential tool for businesses facing cash flow challenges. It allows companies to unlock the value of unpaid invoices, receiving funds upfront rather than waiting weeks or months for customers to pay. However, traditional lenders often base their willingness to provide this type of finance on the creditworthiness of the company’s debtors or the perceived risk associated with the industry.
For businesses with poorly rated debtors—those with subpar credit scores or uncertain payment histories—or companies operating in industries like construction, hospitality, or start-ups in volatile markets, securing invoice finance can seem impossible. Mainstream financiers typically view such businesses as high risk, leaving them stuck in a cash flow bind.
Fiskal’s Unique Approach
We have developed a unique approach to overcoming these challenges. As an independent commercial brokerage, we work with a diverse network of finance providers, including niche lenders who are more willing to take on riskier clients. Instead of relying on traditional criteria, We dig deeper into each client’s circumstances, seeking to understand the nuances of their financial situation and business model.
This bespoke approach allows us to match challenging businesses with the right invoice finance provider. Here’s how we do it:
- Understanding the Business and Industry
We take the time to understand the specifics of the business and the industry in which it operates. This deep dive includes evaluating cash flow cycles, the nature of the company’s clients, and the broader market environment. By understanding the full picture, we can present a more compelling case to potential lenders. For example, a construction company might face lengthy payment terms from clients, causing cash flow issues. Mainstream lenders may shy away due to the high-risk nature of the industry, but we find lenders with expertise in construction finance, who understand the particular dynamics at play.
- Working with Specialist Lenders
Our access to a wide array of lenders is one of our key advantages. While traditional banks may reject a business outright due to poor debtor ratings or risky industries, we have relationships with niche and alternative lenders who specialise in higher-risk clients. These specialist lenders often have a better understanding of industries that mainstream banks avoid, such as technology start-ups, recruitment, and hospitality. They also employ more flexible criteria, focusing on factors beyond just the credit score of debtors. - Tailored Invoice Finance Solutions
Invoice finance is not a one-size-fits-all solution. We work to customise facilities based on the specific needs of each business. Whether it’s factoring, where the finance provider takes over the management of debtor payments, or discounting, where businesses retain control, we ensure the facility is aligned with cash flow requirements and business goals. For businesses with poorly rated debtors, our partnerships with lenders who use innovative credit-scoring models or more sophisticated risk assessments can make all the difference. These lenders look beyond traditional metrics and are open to working with companies whose debtors may have non-ideal credit ratings. - Negotiating Favourable Terms
Once we find the right lender, the next step is negotiating terms that work in the client’s favour. High-risk clients are often subjected to high-interest rates or restrictive terms from mainstream lenders. Leveraging our relationships and market knowledge, we negotiate competitive rates and flexible terms for our clients, ensuring they get the best deal possible.
Success Stories
Over the years, we have helped numerous businesses unlock critical funding, even in challenging scenarios. For instance, we assisted a recruitment agency with a portfolio of clients that had mixed credit ratings. Despite being turned down by traditional lenders, we secured an invoice finance facility with a specialist lender who understood the cyclical nature of the recruitment industry and was comfortable with the risk. In another case, we helped a start-up in the renewable energy sector—an industry often seen as risky due to its emerging nature—secure funding despite concerns over debtor reliability. Our deep industry knowledge and access to alternative lenders were pivotal in closing the deal.
Why Fiskal Stands Out
The success of Fiskal comes down to our expertise, extensive network, and commitment to understanding the needs of our clients. We don’t simply place businesses into pre-set categories; we treat each case as unique and use our independent status to search for the best solutions across the whole market.
By focusing on the specifics of each business’s financial needs and risk profile, we ensure that companies with poorly rated debtors or operating in difficult industries aren’t left out in the cold when it comes to invoice finance.
Conclusion
We are reshaping the landscape for businesses that face obstacles when seeking invoice finance. Whether it’s a construction firm with long payment terms or a start-up dealing with risk-averse lenders, we use our industry knowledge, lender relationships, and bespoke approach to secure funding where others might fail.
For businesses struggling to access invoice finance due to poorly rated debtors or challenging industries, Fiskal provides hope—and, more importantly, the cash flow necessary to continue growing and thriving.
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