The biggest UK businesses are increasingly using assets and invoices to secure loans that will enable them to grow, the Asset-Based Finance Association (ABFA) says.
Jeff Longhurst, chief executive of the ABFA, which signs up lenders in the UK and Ireland as members, said 315 businesses with turnovers of £100m per annum or more borrowed a total £5.1bn against their assets and invoices in the past year, up 16 per cent from £4.4bn in 2013.
"Financing tools such as these have been commonplace in the US for a long time, and played a key role in funding the recovery for a lot of businesses in sectors like manufacturing. We're now seeing big British businesses following their lead," he said.
Longhurst said large businesses are turning to asset-based finance in an effort to fund growth plans, suggesting credit is still less available than it was pre-recession to many who need it. Demand has expanded fivefold in 10 years, the ABFA believes.
"There are a lot of UK businesses seeing opportunities for growth, whether through taking on large new orders, investing in their R&D programmes, or recruiting new staff. More and more of them are now borrowing against their assets to fund that expansion," Longhurst added.
"There are general concerns about the availability of finance for businesses."
Asset-based finance can include funding secured against unpaid invoices or a range of assets including stock, property and equipment.
The Bank of England's credit survey came out this month, but the Federation for Small Businesses (FSB) says credit availability has remained restricted, particularly for smaller firms.
John Allan, chairman of the FSB, said in a statement: "Despite an improving economic outlook and some signs of improvement, the underlying picture behind these latest figures is that small firms still struggle to get the funds they need, especially when compared with larger businesses where credit conditions have improved more markedly."
Diversification around credit options was needed, Allan also noted.
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