Structuring Alternative Loans to Supplement the Bank - Receivables
Structured Can Help Bank Lenders Do Transactions
SMEs have effectively been caught in a new credit crunch in 2020 from the pandemic. Credit risk is tight, and it has become more difficult for companies to obtain increases to their lines of credit or establish a new operating line to finance receivables.
Structured Business Financing works with Banks to provide complimentary debt financing solutions for small and mid-sized businesses that can fill the gap or “top up” their existing bank facilities. Instead of replacing the senior lender, our specialty is to position loans that can be subordinated to the bank’s securitization priority.
Structuring Alternative Loans to Supplement the Bank - Receivables
Common Deal Killers – Receivables Financing
• The advance rate does not provide sufficient coverage (i.e. borrowing base)
• Receivables composition is too concentrated, or amounts too small
• Challenging customer payment terms (e.g. extended aging), bad debt
• Industry risk is high
• The company has a thin capital base or working capital
• Recent business performance weakness
• High Growth
Structured Business Financing Complimentary Receivables Financing Focus - 72 Hour Decision Solution
Financing specific receivables is ideal for SMEs that are looking to move quickly on new opportunities and grow their business. We can help you help your clients.
Structured Business Financing will engineer a solution that funds individual receivables on the spot. Credit decisions are based on the quality of the receivable which can be quickly determined in 48-72 hours, rather than being based on a full company credit analysis and due diligence of the entire receivables listing/customer base. Funding is immediate and replenishes the company’s working capital quickly.
With the bank’s line of credit facility remaining in place, the bank provides a waiver of their security over the specific receivable(s) that the company wants to finance.
This type of financing can work for many types of businesses but is particularly well suited for service businesses, manufacturers and for exporters. Other advantages include: No requirement for personal guarantees, liens, or additional security, no long-term contracts, and a transparent pricing.
Contact us to help you solve problems or address opportunities….
Many businesses require more capital. Beyond receivables financing there are a range of different options that we can structure to fill in the gap or “top up” their existing bank facilities.
Structured Business Financing can help companies with financing solutions for: working capital, inventory, factoring and purchase orders, equipment, real estate, growth financing, acquisitions, management succession financing, debt restructuring and refinancing.
Contact us to discuss to start a discussion on how we can support you.