Alternative lender reports spike in new client take-ons

This as businesses' access to traditional funds dries up

Alternative lender reports spike in new client take-ons


By Mina Martin

Australian financing company OptiPay has reported issuing more than $25 million in new facilities since the start of this year – nearly a tenfold increase – as rising rates and surging cost of living make access to traditional funds tougher for many businesses.

“We’ve had a huge spike in broker-driven enquiries as access to capital becomes more difficult for many businesses,” said OptiPay CEO Angus Sedgwick (pictured above). “Banks are becoming more risk-averse in the current climate and it’s forcing many businesses to look at alternatives to maintaining their cash flow.”

OptiPay, formerly TIM Finance, specialises in invoice financing – an innovative, revolving line of credit against unpaid invoices – to improve business cash flow.

“The majority of new enquiries have come from the agriculture, transport and logistics, mining services, and manufacturing,” Sedgwick said. “Many SMEs are increasingly turning to brokers to facilitate their lending as they juggle unpaid tax debts, supply chain issues, and rising inflation.”

He said the company’s main goal is to help businesses that are going through a period of growth, and as long as they have a good model and have orders coming in, OptiPay can work with them.

“Any business that invoices another business for goods or services on credit terms is a good candidate for an invoice financing facility,” Sedgwick said. “Businesses can typically access up to 90% of their sales revenue within 24 hours of issuing the invoice. Unlike more traditional business loans there are no ongoing repayments back to the financier as they are repaid when the debtor makes payment of the invoice/s. The fee paid to the financier usually ranges from <1% up to 3% of the invoice value.

“Cash flow is everything for a business and in the current economic times it’s even more important it’s maintained,” he said.

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