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James Mitchell
Following last week’s decision by the Commonwealth Bank to withdraw from debtor financing, Bibby Financial Services has reaffirmed the importance of debtor finance and its support for the Australian market.
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CBA's withdrawal of the facility has come despite the growth of and demand for debtor finance products in the market.
Total debtor financing turnover in the March 2011 quarter was $14.3 billion, an increase of 6.6 per cent on the March quarter in 2010.
"SMEs are in greater need of flexible forms of working capital more than ever before and we don’t believe the bank’s business decision will adversely affect the market in Australia," Bibby Financial Services managing director Greg Charlwood said.
“SME interest in debtor finance grew rapidly during and after the global financial crisis, when credit became scarce and borrowers did not want to use personal property as security,” he said.
“It is now used widely throughout the business-to-business sector and SME confidence in this form of funding is growing.”
Reflecting these sentiments, intouch Finance is set to launch its own debtor finance product.
intouch founder and cheif executive Paul Ryan said it is time Australian business owners were given better financial options in order to help them realise their business objectives and vision.
“Anyone who owns their own business, no matter how big or small, knows the challenge of maintaining cash flow,” he said.
“I’m determined to provide an alternative -- particularly when the big banks don’t seem all that interested in servicing this sector.”
