Posted: Monday, 10 February 2025 @ 11:44
While some plan their financial year from January, others plan from the beginning of April. Whichever camp you sit in, now is the perfect time for lenders to organise their funding line for the months ahead to help manage and grow their block business.
Since launching our incubator block discounting facility, Rivers has built a strong reputation amongst new and existing lenders, for providing the right level of funding to grow their own book. For independent brokers who want to build a book from their own deal flow, it's an opportunity to get started, diversifying your business and building real future value in your book in addition to your commission earnings. Meanwhile, for lenders who already have existing funding, we may be able to offer a supplementary funding line.
As you plan for your year ahead, amidst the much-reported economic turbulence, diversification and forward-planning are words to live by. Here are a few of the reasons why now is an excellent time for brokers to line up block funding:
Market and lending conditions
For many years now, central banks including the Bank of England, have adopted much tighter lending criteria, making it difficult for SMEs of all kinds to access the kind of capital they need specifically for cash flow and growth. In the current market that trend is showing no signs of abating, creating opportunities for lenders to step into that space and provide much-needed support, working with brokers to deliver more dynamic, alternative financing options. For brokers, it’s an opportunity to secure funding arrangements that cater to clients’ needs and thrive despite challenging conditions.
Increased demand for financing
With inflationary pressures and economic uncertainty, many businesses are likely to need more financing to maintain operations, invest in growth, or manage cash flow. In January, for example, Business Money reported that 57% of small businesses need funding to grow in 2025. Block funding arrangements can provide greater flexibility, better terms, and more certainty compared to traditional bank loans, and open an opportunity both for borrowers and brokers.
Access to larger capital pools
One of the reasons our incubator block discounting facility is so unique, is that it helps set new lenders up, so they can grow their book and eventually move to larger block providers. Getting the right level of funding to grow your own book from the start can be a big challenge. For many smaller funders and brokers running their own book, Rivers has been the first lender to help them with their processes and operations. This has enabled them to grow their own books to a point where they can then go on to access additional block lines from banks and larger finance houses, that they wouldn’t have otherwise been able to obtain.
Meanwhile, as a small, established lender with your capital tied up in loan agreements, meaning you need funding to achieve further growth or explore new opportunities, then Rivers will work with you to establish your eligibility for funding and the level of funding you might be able to achieve. Then we could release cash against blocks of your customer agreements at a discounted rate, allowing you to reinvest this money into new agreements and develop your book further.
Preparing for the year ahead
Block funding allows brokers to tap into larger sums of capital, which may be crucial for clients seeking financing in the coming months. By securing block funding now, brokers can ensure they have access to the necessary capital for upcoming deals, especially if lending restrictions are anticipated to increase in the near future.
Gaining a competitive advantage
With the current lending environment, being able to offer flexible funding solutions to clients might give you as a broker a competitive edge. Furthermore, brokers with access to block funding can stand out as a reliable source of liquidity for clients who may otherwise struggle to access funds through more traditional means or find the processes cumbersome in the context of day-to-day capital management.
If you are an independent broker who's interested in expanding your business by building a book from your own deal flow, or you're an existing lender looking for a supplementary funding line, Rivers' block discounting facility could be for you.
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