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Customers won’t appreciate the
impact of this [Barclays’] policy until they realise that the loans
advanced are either unsecured, and therefore will limit the bank’s
appetite to offer other facilities without security, or will
require third-party security such as a charge over property or
The point about asset finance is
that the extrinsic value of the asset provides the lender’s primary
source of security.
Martin James, director,
Crystal Business Finance
Martin has a point but when the
asset is not seen as providing a tangible source of collateral, and
underwriters have to get comfortable with the company’s cash
generation as a primary source of repayment, what difference does
it really make?
David Angus, business
development manager, Key Equipment Finance
Both Martin’s and David’s points
are valid, but SMEs need to be aware of the Loan to Value%age
Barclays will be offering with these loans.
It is great to hear them offering
these loans but more importantly to see Barclays actually write the
As a matter of fact, Barclays is
missing a trick here.
The bank was heavily into asset
finance brokers before the economic slump and brokers would be a
quicker route to market, marrying SMEs with Barclays’ available
loans, rather than trying to start from scratch.
Nik Cooper, managing
director, Nationwide Business Finance