Automatic referral by the banks is something that the Federation of Small Business has campaigned for over many years.
There are alternative lenders and automatic referral will help
Automatic referral by the banks is something that the FSB has campaigned for over many years.
In the past if I put an application for borrowing to my own bank and that got turned down, that was obviously the end of the road for many small businesses. That could mean serious financial difficulty. It could mean shelving or postponing growth plans. Now with automatic referral that loan application has to be passed onto an alternate lender.
So this means that even if a conventional bank – one of the main banks – doesn’t want to lend to a particular business, it can be introduced to alternate lenders.
Some of the new challenger banks will participate in this. It means also that it could be referred to some of the alternate platforms like peer to peer lending. So there are now many more opportunities for small business borrowers to get access to the finance they vitally need.
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