Barclays has formed a partnership with online invoice financing platform MarketInvoice to provide UK SMEs easier access to credit.
As part of the deal, Barclays has taken a ‘significant’ minority stake in the company. Barclays is the first high-street bank to enter a strategic partnership with MarketInvoice and will give its customers access to digital invoice financing.
The bank completed the partnership as part of its plan to invest in new business models for growth, and help the company increase its reach in the UK. Barclays also has plans to fund invoices through the solution in the future, so it can better support the small business market.
This service will be introduced to UK SME clients of Barclays over the coming months in areas including East Midlands, West Midlands, Herts and North West London. A full roll-out is scheduled for next year.
UK-based MarketInvoice uses smart technology to provide businesses loans and invoice financing solutions. These are funded through a selection of institutional investors which includes the British Business Bank, UK local authorities, global family offices and sophisticated and HNW investors.
Last year, the company nearly doubled the average amount advanced to businesses, rising from £606,000 in 2016 to £1.4m in 2017. The average value of invoices also raised from £56,495 to £96,597. Institutional investors helped to deploy £445.7m to UK-based businesses last year.
Since the platform was founded in 2011 it has helped to fund over £2.7bn in invoice credit.
Barclays Business Bank CEO Ian Rand said, “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.”
Earlier in the year, MarketInvoice received £135m from Banco BNI Europa and Varengold Bank to support funding more invoices on the platform.
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