Struggling With Late Payers? Unlock Cash Flow With Same Day Funding Business Loans

Late payments are a major challenge for UK businesses, especially those at the smaller and medium end of the scale that might not have the cash reserves to cover their expenditure while they wait. Delayed payment of invoices can easily disrupt cash flow, hinder growth and potentially even threaten the existence of the business.

The question for many small and medium sized businesses (SMEs) is what to do in these circumstances? Sometimes it is just not possible to wait it out but there is one option to help mitigate the risks of late payment. Same day business loans can be a crucial tool for helping SMEs maintain financial stability and get through these challenging periods. Below we will take a closer look at the many benefits of leveraging same day business loans for cash flow. But first it’s worth exploring the problems presented by late payments.

The Impact Of Late Payments

According to research by Natwest, more than a quarter of UK SMEs are owed between £5,000 and £20,000 in unpaid invoices at any one time. For larger businesses these kinds of amounts are not significant but for a smaller organisation it can represent a large portion of monthly or even annual turnover. The Federation of Small Businesses reported that one in four businesses noticed that late payments became more of an issue in each quarter of the financial year. This lack of payment can lead to major cash flow instability which makes it hard or even impossible for the businesses to meet their own financial obligations.

The Benefits Of Same Day Loans

To meet the challenges caused by late payments, more and more businesses are turning to same day loans. This kind of rapid financial support allows businesses to bridge the gaps caused by delayed invoices. The main benefits of same day loans include:

• Fast access to funds: Unlike traditional loans, which can take a long time to process, same day loans promise financial support within 24 hours.
• Flexible use: Same day loans can be used for a huge variety of operational expenses, such as purchasing inventory, investing in growth or payroll.
• Simplified application: Also unlike some traditional types of loan, the application process is much more streamlined and easy to accomplish.

The Broader Economic Impact

The financial strain of late payments is not just felt by small businesses but by the wider economy. Late payments are thought to cost the UK economy around £1.6 billion a year. The UK government has even taken some action to try and mitigate this impact, supporting small businesses affected by the issue. But same day lenders remain the go-to option for most SMEs.

What To Consider

Before taking out short term business cash flow loans, or any kind of funding, businesses need to consider the risks and requirements of doing so. These include factors such as interest rates and fees, ensuring they understand the cost of borrowing. There are also repayment terms, which can vary a lot, with some being far more preferable for some businesses than others. The reputation of the lender is also a key consideration, and only reputable and registered lenders should be approached.

Despite the considerations of same day lending, there is little doubt this represents an effective solution for the challenge of late payments. Practical, flexible, fast and simple to apply for, there are many benefits to leveraging same day funding. And it might just be the answer to invoicing obstacles.

You can find out more about same day funding loans for SMEs by getting in touch with the Century Business Finance team.

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