The FLA held round
tables at all of the UK’s political party conferences. Grant
Collinson reports.
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Amid the
back-slapping, booing and all that talk of cats during this year’s
party conference season, the trade bodies of the asset finance
industry stated the case for leasing to MPs.
The UK’s Finance and Leasing
Association (FLA) held round-table talks at the annual conferences
of all three major political parties in conjunction with the Asset
Based Finance Association (ABFA).
The trade bodies were joined at
the table by members of the asset finance industry and SME owners
and directors, other professional bodies, including the National
Association of Commercial Finance Brokers (NACFB), and
parliamentarians.
The events were chaired by
Anthony Hilton, city editor of the London Evening
Standard.
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By GlobalDataJustin Rose, head of asset
finance with the FLA, said the events had successfully brought
together the views of the SME owners, finance companies and
policy-makers and said it was this combination of views that led to
the most useful insights.
Rose said: “The MPs were very
engaged in the discussions and gave us excellent feedback. They
particularly appreciated the opportunity to meet directors of local
businesses.”
Business owners were invited by
the FLA to explain to MPs their concerns over credit facilities
available to small businesses.
Rose said: “The experience of
the SME directors allowed the identification of a number of
practical options to help more SMEs invest and grow using
alternative sources of finance including asset finance.
“For example, the need to
provide small businesses with information to help them investigate
funding options was a common theme and one we will be addressing by
publishing a new directory of sources of asset finance.”
Other issues discussed included
concerns over the regulatory environment. Business owners
identified the current tax code and capital requirement rules for
banks as barriers to some SMEs obtaining finance.
The groups also found banks and
traditional bank lending are often perceived as the default options
for SMEs and identified some finance needs could be met more
effectively through alternative forms of finance.
Solutions to these problems were
also under discussion and options for addressing the regulatory
concerns were mooted.
Proposals included improving and
simplify the tax rules affecting leasing by small businesses and
developing a new form of fee-based government risk-sharing to
support new lending via alternative forms of finance, according to
a report on the events released by the FLA.
Rose said asset finance was used
by around 750,000 UK businesses and often helped businesses that
may not be able to raise finance in other ways.
“However,” he added, “it can
still be difficult for a minority of SMEs – particularly start-ups
and businesses with poor credit ratings – to obtain finance for
sizeable equipment investments at attractive rates.
“We have called for the
government to make it easier for the asset finance industry to
support those businesses, for example by extending the Enterprise
Finance Guarantee to include leasing.”
The FLA report also stressed the
need to raise business owner awareness of alternatives to
conventional bank loans and overdrafts, and provide practical and
appropriate information to help SMEs access them.
NACFB chief executive Adam Tyler
said: “The NACFB has increased its lobbying over the past 12 months
and was very pleased to be able to offer a direct view from the SME
coalface, both to participants at fringe meetings and direct to MPs
at all three party conferences.
“This has led to some
interesting discussions on the importance of brokers in bringing
struggling SMEs together with the right funder.
“These are usually only
available through an intermediary channel and this has opened
dialogue on how small businesses across the UK can access this
information to help them grow their business and subsequently the
economy once again.
“This is a pivotal moment for
the broker channel and one the NACFB is pursuing with some vigour
on behalf of its members.
Delegates from GE Capital
Equipment Finance, Lombard, RBS Invoice Finance and Bibby Financial
Services represented lessors at the round tables.
Politicians attending the events
were Adrian Bailey (Lab), chairman of House of Commons business,
innovation and skills committee; Nick de Bois (Con); Sam Gyimah
(Con); Ian Lucas (Lab); Lord Newby, chairman Liberal Democrat
backbench Treasury committee; Stephen Timms (Lab); and Nadhim
Zahawi (Con).
None of the MPs in attendance
could be reached for comment by Leasing Life prior to
publication.
