• What If 29% Of Invoice Finance Users Fall Outside Of UK Finance?

    Are 29% of invoice finance users outside of UK Finance?Industry trade bodies give reassurance to customers in a number of ways. Firstly, there is normally an application and assessment process, that brings some rigour to membership, that can in turn give comfort to customers of the members.

    UK Finance Complaints Process

    Secondly, as is the case with UK Finance, the industry trade body for the invoice finance sector, they may operate a complaints process which is arbitrated, independently of their members.

    Whilst the majority of customers are very happy with the service that they are receiving, this again this gives customers reassurance that if the relationship with a member breaks down, they have the back stop of referring the matter for independent adjudication.

    Transfer Protocol

    Also, in the case of UK Finance, their members have a transfer protocol that smooths the transfer process for clients that want to leave their current provider. This may not seem important up front, but if you get to the point that you want to move providers, you are likely to welcome the benefits of such a process, to minimise disruption and hold ups.

    UK Finance Members & Non Members

    UK Finance is the new umbrella organisation that has absorbed what used to be called the ABFA (Asset Based Finance Association). My count of their members, against my estimate of the number of invoice finance companies in the UK, suggests that at the time of writing, c. 41% are members of UK Finance, with the remaining 59% being non members. Some of these non members have chosen to become members of other trade bodies e.g. the Peer-to-Peer Finance Association.

    My previous post suggested that, based on a piece of recent research and some extrapolation of the numbers, there could be over 16K of clients that now fall outside of UK Finance. That could account for almost 29% of UK invoice finance users, by number.

    Questions For Clients Of Non Members

    There are a number of questions that could be prudent, for the 29% to ask, before taking up a facility with an invoice finance company that is not a member of UK Finance.

    1. Are you members of another trade body organisation?

    2. If so, what were the qualification criteria to join?

    3. Does that organisation have a complaints procedure?

    4. If there is a complaints procedure, does it include an independent complaints adjudication process?

    5. What are the procedures and protocols for transferring to another provider in the future, and how do they compare with the standard UK Finance guidelines for inter-party transfers?

    In some cases, there may still be good reason to take up a facility with a non-member organisation, despite not having some of the above benefits. For example, the type of facility offered, the pricing or flexibility of funding may not be available from a member of such a trade organisation.

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