Moore Stephens, the accounting and advisory firm, has announced a collaboration with alternative credit specialist Caple for unsecured SME debt finance.
The deal will allow SMEs and owner-managed businesses to apply for long-term unsecured finance of between £500,000 and £5 million.
Moore Stephens said SMEs struggle to access debt finance without additional assets to provide security: instead they have to agree to personal guarantees or dilute their equity to get funding.
Caple offers unsecured lending based on the future cash flows of the SME, requiring no collateral or personal guarantees as security. It said it was able to do this through its strategic alliance with BNP Paribas Asset Management.
Loans originated by Caple are part of BNP Paribas Asset Management’s direct lending programme, which aims to provide €1bn in funding across Europe and €400m in the UK per year.
Supported by Caple’s proprietary technology platform, Moore Stephens will assess the eligibility of its clients for funding through the preparation of business plans and financial forecasts.
This move is part of Moore Stephens’ ambition to grow its advisory capabilities and broaden the breadth of the services it offers to owner managed businesses and SMEs.
Mark Lamb, partner and head of owner managed businesses at Moore Stephens, said: “We partner with our clients to support their aspirations and contribute to their success. This means helping them assess and secure the funding they need to grow.
“Debt finance is critical to clients’ growth, and management succession but options are limited. We’re delighted to be working with Caple, giving our owner managed business clients greater options for accessing long term unsecured finance.”
Caple originates loans through its network of business advisory firms such as Moore Stephens. It combines this with an initial credit assessment by Caple’s credit analysis teams, creating a seamless, end-to-end credit process.
Dominic Buch, co-founder and managing partner of Caple, said: “Ten years after the financial crash, it is still difficult for SMEs to raise debt finance for growth or management succession. This is because banks can generally fund an amount that reflects the assets in the business and if a business has no further assets, banks can’t help.
“In a service-based economy such as the UK, this can create a barrier to growth and may push some businesses to issue equity instead of raising debt.”
Recently Caple completed a £4.25m unsecured deal with Ralph Coleman International, a retail services business.
This loan follows Caple’s first UK deal of £1.5 million with Baltimore Consulting, a specialist recruitment services company, in the summer.