Barclays has revealed it is to partner with leading fintech business MarketInvoice, Europe’s largest online invoice financing platform.
The move comes one month before the asset finance industry meets to discuss new moves in optimising opportunities with small businesses at the International Asset Finance Network conference on 13 September in London (see below).
The deal aims “to transform the way small and medium enterprises (SMEs) in the UK manage cash flow and accelerate growth”.
The bank has committed to a significant minority stake in the firm to give Barclays’ SME clients seamless access to innovative forms of finance. The new partnership is a key part of Barclays’ plans to invest in new business models for growth, and MarketInvoice’s ambition to broaden its reach across the UK.
Anil Stocker, MarketInvoice CEO (pictured above) explained that MarketInvoice, founded in 2011, has funded invoices worth more than £2.7 billion, boosting cash flow for thousands of UK businesses.
Invoice finance facilities bridge cash-flow gap
Barclays is the first high street bank to enter into a strategic partnership with MarketInvoice, thus giving their customer base access to the fintech's proprietary single invoice finance product as well as broader digital invoice finance facilities.
The terms of an invoice normally dictate a long payment period that can be up to 120 days, leaving businesses with a cash flow gap in the interim. With invoice financing, SMEs who sell goods or services to other businesses can upload or sync their invoices to MarketInvoice’s platform and sell them to investors, unlocking fast access to funding.
The proposition will be introduced to Barclays’ SME clients over the coming months in areas across the UK, including the East Midlands, West Midlands, Herts and North West London, with a full roll-out set to commence nationwide in 2019. Barclays also plans to fund invoices via the platform in the future, growing its asset base further.
Anil Stocker said: “It’s exciting to be combining the knowledge and footprint of a 325-year old British banking institution with MarketInvoice’s tech-led online finance solutions. Bringing this together in a strategic partnership can only mean good news for UK businesses, with the segment we’re targeting responsible for upwards of 60% of UK employment.
History of innovation
“Barclays has a long history of innovation being the first bank to introduce the credit card and the ATM. It makes total sense to partner and introduce our online business finance solutions for their large customer base.
“It’s easy to forget that the companies you see on the FTSE 100 all started as small businesses with founders following a passion. In focusing on the needs of these entrepreneurs through this collaboration, Barclays and MarketInvoice will truly transform the experience of UK companies in sourcing finance.”
Ian Rand, CEO of Barclays Business Bank, added: "Invoice finance is a product that has come of age in the digital era, it’s efficient, effective and controllable for small businesses.
“A number of our clients told us that they feel pressured into offering longer payment terms in order to stay competitive. This ties up their cash flow, preventing them from seizing growth opportunities.
“Invoice financing gives small businesses the power to obtain funding in a fast and innovative way, and capitalise on those moments. Our corporate bank already offers invoice financing to large businesses, so it’s great news that we’re able to extend the proposition to work for our SME clients as well.”
Barclays also recently launched £100,000 unsecured lending for SMEs, doubling its maximum for unsecured business loans from £50,000 to £100,000.
Rand added: “This increase adds to Barclays' already class-leading unsecured lending offering which allows qualifying SME clients to access pre-assessed affordable lending up to £25,000 on the go via their mobile and through online banking, often receiving the cash that same day.”
IAFN conference set to “thrash out the issues”
The International Asset Finance Network conference in London on 13 September is set to thrash out issues relating to the maximising of revenues from SMEs – and optimising the broker channel.
With presentations from Patrick Jelly, Aldermore Asset Finance and Christoph Rieche, IWOCA (one of Europe’s foremost fintech lenders) a panel of experts including Adam Tyler, Financemybusinessonline, Bernie Skivington, British Business Bank and Osian Rees, Investec Asset Finance, are set to answer searching questions set by chairman John Bennett, (ex-Bank of America).