Commercial Broker (NACFB Magazine) December 2020

Issue 85 DECEMBER 2020

Broker COMMERCIAL

The award-winning magazine for the National Association of Commercial Finance Brokers

18 THE THIN BLUE LINE All brokers have a role in spotting financial crime

22 HMRC TAKES PREFERENCE Ranking creditors in the insolvency distribution waterfall

When finance isn’t enough How brokers can support insolvent SMEs

40 HELP US HELP YOU Brokers reveal what they would like to see from lenders in 2021

44 RECOGNISING INDUSTRY EXCELLENCE Two award ceremonies, one big online celebration

Contents

In this December issue NACFB News

Special Features

4 6 8

10-11 12-14

Note from Norman Chambers Updates from the Association Note from headline sponsor, Lloyds Bank Industry news round-up Patron news

22-23 24-26

28-30 32-33

34-35

Paul Goodman: HMRC takes preference NACFB: When finance can’t help NACFB: Funding future growth Paragon Bank: Preparing your landlord clients Wesleyan Bank: Solid steps in uncertain times

Industry Insight 36

38-39

Just Cashflow: Anticipating SME needs Barclays: Driving sustainable growth

Opinion & Commentary 40-41

42-43

44-46

32 Patron Profile 16-17

48

50

Knox Capital Solutions: Help us help you Direct Asset Finance: Embracing the pivot NACFB: Recognising industry excellence Listicle: 5 tips for a happy, socially distanced Christmas Five minutes with: Lucy Painter, Director, FUNDING ROUND

40 Further Information KIERAN JONES Editor & Feature Writer

33 Eastcheap | London | EC3M 1DT Kieran.Jones@nacfb.org.uk JENNY BARRETT Communications Consultant

33 Eastcheap | London | EC3M 1DT Jenny.Barrett@nacfb.org.uk LAURA MILLS Graphic Designer

Swishfund: By entrepreneurs, for entrepreneurs

33 Eastcheap | London | EC3M 1DT Laura.Mills@nacfb.org.uk

Compliance Update

MAGAZINE ADVERTISING T 02071 010359

18-19 NACFB: The thin blue line

Magazine@nacfb.org.uk

Ask the Expert 20

NACFB: Jenny Barrett – Getting noticed on Google

38

MACKMAN Design & Production T 01787 388038

mackman.co.uk

NACFB | 3

Welcome

Norman’s Note

T

he closing of each year provides an opportune time to look back on successes and challenges. I don’t know about you, but doing so this year feels somewhat exhausting. It has been a year where truth has been stranger than fiction, connectivity has been maintained in isolation, and normal has become the new radical.

I will however look back at some more recent successes. Last month, at the height of the second lockdown, the NACFB hosted its first ever virtual awards ceremony. Hundreds of you gathered online to celebrate the NACFB Patron Awards and the Commercial Broker Awards. These accolades sought to recognise both lending and broking excellence in the last year, and although they were intended to be separate ceremonies, COVID presented the Association with a unique opportunity to celebrate together, as one community.

It made for a fun few hours and the full shortlist with results can be found on p.44.

Norman Chambers Managing Director | NACFB

The NACFB was also heartened to see hundreds of Members take the time to complete our end of year broker survey. You’ll have to wait until January’s issue to see the full analysis, but I’ve seen some of the initial findings. A high-level review of the survey results paints a picture of NACFB Members continuing to ensure UK SMEs receive critical business funding throughout the most challenging of times.

I wasn’t at all surprised by the results, but I remain grateful to all those who shared with us their business activity from 2020.

Such vital data empowers the NACFB, so that when we continue to lobby HM Treasury, BEIS, the Bank of England and the British Business Bank, we are doing so with the full weight of empirical data behind us – and in Members’ best interests.

Without all Members raising their voices, it is a lot harder for the NACFB to raise ours. And without efforts across our community, it is much harder to keep Moving Britain Forward.

4 | NACFB

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NACFB News

Association updates for December 2020

Looking to a prosperous 2021 NACFB launches ‘Broker Protect’ for business support

Members vote to freeze membership fees at 2020 AGM

As an ongoing commitment to provide Members with a range of tangible benefits that offer real value to firms, the NACFB is delighted to announce the launch of Broker Protect. Member brokers will now have free access to HR, legal, health and safety, tax and VAT business support services.

The NACFB’s first-ever fully virtual AGM took place last month and the Association’s Members voted to pass all the proposed resolutions by a clear majority. The results mean that membership fees will remain the same for both Members and Patrons for the coming calendar year.

These four key services are delivered through access to five direct advice lines, in addition to an online library of more than 750 downloadable template documents.

The AGM also passed a series of measures to restructure the NACFB Board of Directors, enabling the creation of both a Members Advisory Group (MAG) and Patrons Engagement Group (PEG). Both the MAG and the PEG will provide a new platform to increase levels of engagement which will be central to the new way of working.

Norman Chambers, NACFB managing director, said: “We are thrilled to be able to offer free business services which we believe will genuinely protect our Members and give them peace of mind in these challenging times.

“2021 will see the Association increase the number of benefits available to Members, with a focus on adding demonstrable value through an increasingly diverse range of channels. I encourage all Members to take advantage of the free support that the NACFB is providing.”

The new services are available to Members through investment by your trade body and can be accessed online via nacfb.org/broker-protect 6 | NACFB

The approved changes will also see a smaller Board of Directors and further details on both steering groups will be announced soon.

Norman Chambers, NACFB managing director, commented: “Whilst the NACFB Board have remained flexible and agile in 2020, it is important that some longer-term stability is built into the structure, to ensure that many of the current and aspirational projects and plans come to fruition.”

The full virtual AGM can be rewatched via nacfb.org/2020agm

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Note from our Sponsor

Conversations on recovery We’ve been listening and trends are emerging

Andy Bishop UK Director, Commercial Broker Development Lloyds Banking Group

improvements. The pandemic has highlighted the fragility of our earth and so many businesses are considering how to build on their sustainability agenda. This makes economic and social sense – the clean economy is forecast to grow four times faster than the total economy as a whole.

A

3. Resilience – Many have had the resilience of their business models severely tested and are now thinking differently about their supply chains, their resource models, flexibility in their working practices, and scalability in their operations.

Over the last few weeks, Lloyds Banking Group has been hosting several Big Conversations across the UK, virtually bringing together clients, industry leaders, community members, political representatives and experts to participate in conversations about recovery. Our conversations have identified regional and sector specific challenges; these will need to be addressed through tailored solutions as we move into the recovery phase.

It was interesting to hear from clients and panellists about what they have been doing to ensure they are well positioned as we move into the recovery phase, which aggregated into four key areas:

All of these elements provide opportunity for brokers as businesses seek funding for investment, additional working capital, diversification or restructuring and acquisition finance – so whatever the uncertainties of the moment, the real certainty is that many businesses will need their broker more than ever in 2021. And we remain committed to supporting brokers as a key part of our strategy to Help Britain Recover.

s I write this column, the government has just announced further national restrictions in England for the next four weeks – hopefully by the time you read this, those restrictions will have reduced or indeed been removed.

1. Innovation – Businesses consistently called out the importance

of diversifying business models, looking for new markets, expanding product ranges and developing new ways to get products to market, with an unsurprising heavy emphasis on virtual distribution. Additionally, we have seen an increase in small businesses using digital solutions and investing in technology. The Lloyds Bank digital index noted that there is an £85 billion GDP opportunity if small businesses in the UK were to adopt more digital practices.

2. Investment – We have heard from lots of businesses about investment in automating, efficiency and productivity 8 | NACFB

4. People – Businesses called out the importance of investing in intellectual capital; ensuring that they are retaining and developing talented employees and making sure that they are invested in the company they work for. At a policy level, the government needs to do what it can to encourage businesses to protect jobs and incentivise up-skilling and re-skilling to create greater productivity and flexibility in the UK plc workforce.

Finally, a massive thank you to the NACFB for a fabulous Autumn Virtual Expo and amalgamated Patron and Member Awards – congratulations to all the nominees and winners. Let’s all hope for a real Gala Dinner next year!

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Industry News

Industry News 3. Charitable fund could help pay down deficit

1 1. Economy grew by record 15.5% in Q3 Official data shows that the UK economy grew at a record pace in the third quarter of the year, rising by 15.5% between July and September. However, growth was weaker in September than in the preceding months, while the country’s economy is still 8.2% smaller than before the virus struck. Despite the rebound in July to September, analysts warned that the economy was likely to shrink again in the final three months of the year because of the impact of renewed lockdowns.

2. Experts expect wave of corporate insolvencies Experts have warned that the withdrawal of government support will deliver a wave of business closures. While official figures show that the number of corporate insolvencies fell in 2020 compared to 2019, analysts say the number would have been far higher but for government support. Colin Haig, president of insolvency and restructuring trade body R3, said: “The first few months of 2021 could turn out to be difficult ones for large swathes of businesses which have built up arrears with landlords, suppliers, or the taxman.”

10 | NACFB

6. FCA stops platform exit fee work

A High Court judge has said a charitable fund set up by an anonymous donor in 1928 could be used to pay off some of the UK’s national debt. The National Fund was created with a gift of £500,000 that was to be left until it had grown large enough to discharge the UK’s national debt. The fund, which is now worth £512.2 million, is a valid charitable trust, meaning it can be used to help pay off the country’s national debt.

The Financial Conduct Authority has stopped its work on exit fees charged by platforms after some providers stopped charging customers for leaving of their own accord. The FCA welcomed the direction of travel on this issuing saying: “Since expressing our concerns in the 2018 interim report, there has been a marked shift in the market away from exit fees, with at least two major platforms announcing that they would no longer be charging exit fees to its customers.”

4. BoE to relax regulation after Brexit

7. Government warned of extended lockdown risks

The Bank of England’s deputy governor for prudential regulation, Sam Woods, has said that the Bank would relax regulations on small banks after the Brexit transition ends this year to ensure a ‘strong and simple’ framework for challenger banks to cut costs and improve their competitiveness against the eight dominant high street lenders. Mr Woods said in a speech at Mansion House that regulators in London and Brussels would no longer be ‘shackled in lockstep’.

In a letter signed by more than 60 retail bosses, the Government has been warned that many stores may never reopen if the lockdown is extended into the crucial Christmas trading period. The letter, signed by executives of Marks & Spencer, Dixons Carphone, River Island and JD Sports, amongst others, says that the closures have deprived retailers of £2 billion a week. The letter insists: “Retailers of all shapes and sizes must be allowed to reopen by the start of December.”

5. Firms hit by U-turn on job retention bonus Businesses have warned that Chancellor Rishi Sunak’s decision to scrap a bonus scheme for firms that retain formerly furloughed workers has hit budgets, with the money having been factored into cashflow forecasts. Mr Sunak replaced the Job Retention Bonus – which pledged £1,000 for every worker kept on the payroll by the end of January – with an extension to the furlough scheme. Craig Beaumont of the Federation of Small Businesses, said: “That one little bit of light at the end of the tunnel has gone.”

7

8. Treasury permanent secretary: New Budget to come in March

10. FCA expects a ‘significant’ number of firms to fail in coming months

The Government’s tax advisory body has urged the Chancellor to roll out a tax raid on buy-to-let properties and other forms of wealth in a bid to shore up more than £14 billion to help repair the UK economy.

The Treasury’s permanent secretary Tom Scholar says the Chancellor will announce a new government Budget in March as part of plans to raise income tax. The UK’s Budget deficit is expected to swell to £400 billion this year, amid forecasts that the pandemic will push the country into a double-dip recession.

The Financial Conduct Authority (FCA) expects to see a ‘significant’ number of firms to collapse over the next few months, due to the economic pressures of the coronavirus pandemic. In a Mansion House speech, delivered last month, the FCA’s new chief executive Nikhil Rathi warned that smaller financial services firms will be at particular risk: “Ultimately, we can’t intervene to stop firms from failing in the face of economic distress and sadly we do expect a significant number of regulated firms, particularly smaller firms, to fail in the months ahead.”

8

9 9. Firms lack Brexit plans A study from BDO shows that almost two in five medium-sized businesses have no plan for Brexit or have delayed their preparations because of the pandemic.

More than a quarter of 500 business leaders surveyed said adapting their plans for Brexit is their most immediate concern.

BDO managing partner Paul Eagland said: “As we draw closer to exiting the EU, it is important that those in the sectors most impacted are offered support and information to help them navigate a myriad of complex challenges.”

10

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NACFB | 11

Patron News

Patron News Recognise: First new SME bank since lockdown

Funding 365 accredited as new CBILS lender

Recognise Bank has been granted regulatory approval to commence lending, following a successful £27 million fundraising round in October. A subsidiary of AIM-listed City of London Group plc, it is the first SME-focussed bank to launch since the COVID-19 pandemic began.

Funding 365 has been accredited by the British Business Bank as a new lender under the Coronavirus Business Interruption Loan Scheme (CBILS), which has recently been extended until 31st January 2021.

Recognise will lend selectively on a non-regulated basis until the end of the year, offering loans for working capital, bridging and commercial property. From January, competitive savings products will be available to personal customers, and to businesses from the second quarter of 2021.

Under the scheme, the NACFB Patron will provide unregulated bridging loans up to 65% LTV for up to 24-months. These loans will be secured on a first charge basis against residential properties in England and Wales.

The NACFB Patron’s aim is to combine the latest cloud-based technology with a relationship-led approach to give clients the speed and quality of service needed to help grow their businesses.

This will be delivered through dedicated Relationship Managers (RMs) based in London, the Midlands, Manchester, and Leeds who have deep knowledge of industry sectors combined with a genuine appreciation for SME challenges. Importantly, the RMs are usually members of the local community themselves, so they understand the concerns and pressures specific to the SMEs in their respective locations.

Commenting on the launch, Jason Oakley, founder and CEO of Recognise said: “We want to be the ‘private bank’ for SMEs and build a reputation where customer advocacy is exceptional.”

12 | NACFB

Commenting on the announcement, Paul Weitzkorn, director at Funding 365 said: “CBILS is a lifeline for many SMEs who are experiencing lost or deferred revenues as a result of COVID-19.

We’re delighted to have been accredited and to be able to support UK businesses in navigating their way through the pandemic.”

The scheme enables lenders to provide facilities of up to £5 million to businesses with a turnover of no more than £45 million a year, who are experiencing lost or deferred revenues (but are not in difficulty), leading to disruptions to their cashflow. For approved loans the Government will make a business interruption payment to cover the first 12-months of interest payments and any lender-levied charges. The borrower remains 100% liable for the debt.

Patron News

Patron News Allica sees 235% increase in commercial mortgage applications Allica Bank has seen a surge in demand from its broker channel with a 235% increase in commercial mortgage applications since June. To help meet this unprecedented requirement for SME finance, the NACFB Patron has ramped up its operational capacity to be able to support £100 million in lending over the next quarter.

Whilst scaling up, Allica has maintained a focus on driving a high level of broker satisfaction. This includes making a number of changes to its Introducer Portal to ensure that it is clearer and more intuitive for brokers to use.

A recent Allica survey revealed that 99% of its brokers rated the Bank’s overall broker experience as ‘excellent’ or ‘good’, 92% rated Allica BRMs as ‘very good’ or ‘excellent’ and 95% of brokers rated the improved portal as ‘good’, ‘very good’ or ‘excellent’.

Nick Baker, head of intermediaries, Allica Bank, commented: “The support available for our broker partners seeking funding for small businesses, outside of COVID loan schemes, has fallen drastically this year and looks set to drop further. Our message to the broker community is simple – we are here to support you and are on hand to fill the significant funding gap that has emerged.”

14 | NACFB

iwoca sets ambitious £200m CBILS lending target iwoca has laid out its ambitions to lend an additional £100 million to businesses through the Coronavirus Business Interruption Loan Scheme before applications close on 31st January 2021 bringing its total CBILS lending to more than £200 million.

This comes as analysis of Treasury figures showed that iwoca approved one in every 18 of all loans via the scheme in October, helping hundreds of small businesses affected by the pandemic.

In particular, iwoca is focussed on helping new customers onto the scheme. In October only 17% of iwoca’s approvals were given to existing customers. iwoca has also increased the maximum loan value available to businesses through CBILS from £500,000 to £750,000. With a second national lockdown and ongoing regional measures, this will ensure that SME firms can access the finance they need in the face of growing economic pressures.

Garry Barker, managing director of property development at construction company – Dream Developments – and iwoca CBILS customer commented: “To survive, we’ve had to adapt – we’ve diversified into developing storage containers instead of buildings.

We’d have never been able to pivot the business and go down this path if it were not for the Government schemes and of course iwoca.”

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Patron Profile

By entrepreneurs, for entrepreneurs Cashflow is king: we see it, and we raise it ​Andrew Jackson UK Managing Director Swishfund

N

o two SMEs are the same, which is why Swishfund is a bespoke lender to unique businesses. Unlike other alternative lenders we treat every customer as a valued individual. Our lending solutions are designed for each customer.

We are not a factory, but we do have deep pockets. We do not rely on an algorithm, as we know they are vulnerable to black swans like COVID and to missing great opportunities when the ‘computer says no’. We will always listen, and we are not afraid to take a second look at a decline.

We have demonstrated these strong customer service values with our accreditation to the Cabinet Office’s Customer Service Excellence Standard. Under this Standard, we were awarded two ‘Compliance Plus’ certificates for market-leading customer service innovations.

Also, in February we became carbon neutral, and we offer discounts of 1.5% off the APR to carbon neutral customers.

We are members of the Credit Services Association and the NACFB because we believe in codes of conduct, proper treatment of customers, fairness, transparency, and integrity. We have a culture of radical transparency where we help our customers understand their pricing, and reasons for any declines. Our final offers are always better than our indicative offers because we have more information. Our twelve-month capital repayment loans to SMEs 16 | NACFB

are repaid on a straight-line basis, rather than amortising. There are no early settlement fees, which also makes us perfect for a short-term bridging solution. These approaches are always fair for customers, and simply make sense.

Where we’ve come from Swishfund UK was established in 2018, as a subsidiary of our Dutch parent company. The Dutch parent was set up by two successful entrepreneurs who wanted to make access to funding easier for other entrepreneurs like themselves.

The UK business got off to a bumpy start, until the executive management was replaced with Rohan Tully and Mark Bracken

“

Unlike many alternative lenders, our lean operational model and focus on both affordability and recoverability means that we were – and still are – making profit

“

The extension and widening of CBILS meant that we started seeing fewer large loans, and our average loan size dropped to around £110,000, but we were grateful for many sub-£50,000 loans spreading our risk

in early 2019. These two childhood friends brought with them extensive experience in risk, finance, sales, and marketing. One of their champion moves was to hire Farreha Mahmood, our head of indirect sales.

Many of you will already know Farreha from her time in Nucleus and Merchant Money. Farreha is exceptionally determined, tenacious and compassionate. Working with Farreha makes you feel that you are the only person in the world that she cares about. Farreha is building a team around her of equally exceptional individuals, including Justin Parr her second-in-command. I sincerely hope you get a chance to work with them both.

Where we are I joined Swishfund as managing director in February 2020. I will not lie to you – it has been both a thrilling and nail-biting roller coaster ride. We had a brilliant offering at the start of the year. Our focus was on building our brand and creating a smoother customer journey.

Our average loan size (ALS) was £165,000, with a diverse book of loans ranging from £5,000 to £500,000, and bad debt of less than 0.5%. Unlike many alternative lenders, our lean operational model and focus on both affordability and recoverability means that we were – and still are – making profit.

It is a proud achievement that through the locked-down summer of 2020 our bad debt stayed below 1% (it is currently 0.8%!).

The robustness of our portfolio is largely due to our talented head of underwriting, Mark Chesterton, who had been underwriting at Funding Circle for six years prior to joining Swishfund.

Where we’re heading Swishfund made a strategic decision not to position itself for CBILS and BBLS. We thought that if CBILS only covers 25% of turnover, then other lenders need to be there for when CBILS does not sufficiently cover customer requirements. This strategy was working as we steadily increased our lending through May to August. However, in September the market changed considerably. The extension and widening of CBILS meant that we started seeing fewer large loans, and our ALS dropped to around £110,000, but we were grateful for many sub-£50,000 loans spreading our risk.

Our market is for every UK business – except other alternative lenders – and we love brokers. Over 95% of our originations are through brokers. We would always prefer to spend our marketing budget on you than on brand advertising to the direct market.

Swishfund is here to generate money for you, your customers, and to be a sustainable, profitable player that has gained your trust and confidence. We truly value what brokers bring, in filtering businesses that meet our requirements and helping your customers understand how Swishfund is the perfect fit for them. We hope that we are a perfect fit for you too.

NACFB | 17

Compliance

The thin blue line Intermediaries have a responsibility to spot financial crime Dean Williams Compliance Officer NACFB

T

he Office for National Statistics’ quarterly crime statistics for England and Wales have revealed that more than half of all crime is now fraud and cybercrime.

The role NACFB Member brokers undertake in their commercial financing activities ranges from a simple introduction, to being responsible for important aspects of the underwriting process, such as the verification of client information. Through these activities, Members can and do play an important role in the detection and prevention of financial crime.

The Financial Conduct Authority (FCA) has been recently urging lenders to consider how they contain financial crime risk posed by intermediaries, encouraging them to undertake regular reviews of their approved panels. In the FCA’s letter to credit broking portfolio firms in February 2020, it was confirmed that the oversight of staff and Appointed Representatives by firms would remain an area of focus, as failures in these areas could lead to increased risks of financial crime. In the knowledge that this topic remains at the forefront of both regulators and lenders, we look at what the standards and expectations are and what action firms should be taking.

18 | NACFB

A broker’s financial crime obligations Despite the important role brokers and intermediaries can provide in the prevention of financial crime, there is a limited application of money laundering regulations by the FCA to those firms with credit broking permissions. As credit brokers are not themselves credit institutions, they are not subject to Money Laundering Regulations (MLRs) or any provisions of the handbook which relate to maintaining systems and controls to counter financial crime risk.

All such firms should however be conscious of their statutory obligations under The Proceeds of Crime Act 2002 (POCA), which

“

The Office for National Statistics’ quarterly crime statistics for England and Wales have revealed that more than half of all crime is now fraud and cybercrime

requires firms to submit a Suspicious Activity Report to the National Crime Agency if there is a suspicion that a person is engaged in, or attempting, money laundering. A failure to report or tipping off a suspect can lead to criminal proceedings. With such potential consequences, not to mention the reputational impact, it clearly pays dividends to implement effective systems and controls to help manage financial crime risk.

begin to consider the areas of their business which are not resilient to criminal activity and consider the steps to address them. Controls will vary, depending on the size, scale and complexity of a firm's activity, but should include effective governance and responsibility, the collation of appropriate management information (MI), risk assessments, policies and procedures, the vetting and training of employees and effective oversight or even independent reviews.

The FCA issued a revised financial crime guide in October 2020, which provides practical assistance and information for firms of all sizes across the regulator’s supervised sectors, including actions they can take to counter the risk that they might be used to further financial crime. It is acknowledged within the guidance that it is less relevant for brokers and intermediaries, who have limited anti-money laundering requirements, but that it may be useful to assist firms in establishing systems and controls to meet their obligations under the POCA. The NACFB therefore strongly encourages all Members to review the wealth of guidance information provided.

The NACFB is here to help

What should systems and controls look like for a broker?

The NACFB has partnered with SmartSearch, an online based system which allows firms to perform due diligence, carry out Know Your Customer and Adverse Media checks in the UK or abroad, all with SmartSearch’s sophisticated electronic platform.

To compliment SmartSearch and to ensure all staff are competent to spot the red flags and indicators of financial crime, Members can also access the NACFB’s learning platform which hosts a range of courses. These courses cover key financial crime risks and what firms need to know to manage them, including: • Anti-money laundering

Effective systems and controls can help firms detect, prevent and deter financial crime. Member firms should be pro-active in their efforts to prevent criminals taking advantage of their businesses. The FCA Financial Crime Guide recommends a range of considerations, including:

• Client due diligence

• What are the main financial crime risks to your business?

• Fraud prevention for managers

• Do you conduct, regularly review, and implement a risk assessment for your business?

• Financial sanctions

• Financial crime prevention • Fraud prevention

• Suspicious activity reporting • Have you implemented appropriate controls to monitor and manage identified risks?

• How do you identify new or emerging financial crime risks?

Once answers to these questions have been established, a firm can

• Terrorist financing The NACFB compliance department is available to answer all Member questions in relation to financial crime risks and how businesses can manage them, via compliance@nacfb.org.uk NACFB | 19

Ask the Expert

Getting noticed on Google

Q Jenny Barrett Communications Consultant NACFB

Y

ou’ve got a website but how do you get it to appear in the search engines? And which engines?

Google, Bing, Yahoo, DuckDuckGo… We asked new colleague, Jenny Barrett, who joined the NACFB’s communications team in October, to explain the concept of Search Engine Optimisation and provide some pointers to help commercial finance brokers improve their presence online.

This first Q&A focuses on the basics and getting a free, high-profile listing.

What is a search engine?

A search engine is software which searches the World Wide Web for specific information requested by the user. We all know how to use one, for example, when I type “commercial finance broker UK” into Google, in less than a second, I’m given a list of 37,900,000 organic results split into pages of approximately 10 listings at a time. If you’re using a PC or tablet, these organic results are flanked top, bottom and right-hand side with adverts. If you’re using a smartphone, the organic results will be wedged in between the top and bottom adverts.

Which search engine?

There are lots of different search engines and the most important one is Google, which averages around 85% market share 20 | NACFB

in the UK. The term ‘to google’ has even become an accepted verb. In my opinion, it’s best to concentrate on appearing on Google rather than the others which include Bing (c.10% market share) and Yahoo (c.2%).

number, opening details, review score, plus a link to the website and directions. Below this list is a ‘view all’ link which opens a bigger map and a more comprehensive list of commercial mortgage brokers.

&

How do you get your website to appear on the first page of a search for free?

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It depends. It can be extremely difficult to get on the first page of the organic results.

But if you’re happy for your business to be found by potential customers who live near you the task is made much easier using Google My Business.

For the purpose of this Q&A, I’m assuming that your website has already been indexed

by Google. If it hasn’t, let me know and we can cover off this topic in another article.

What is Google My Business?

If you’re not familiar with this way of searching, I urge you to check it out. Very quickly you’ll see it’s an extremely powerful tool for getting noticed.

It’s a great tool which helps you to promote your business and your website on Google Search and Google Maps. And best of all, it’s free!

For example, if I type “commercial mortgage broker tunbridge wells” into the Google search bar, the very first thing I am presented with is a map of Tunbridge Wells pinpointing and naming two brokers.

The map is also studded with several red dots which indicate the location of more brokers. Beneath the map, three brokers are listed (including the two on the map) complete with their address, phone

How do you get a listing on Google My Business?

You’ll need a Google My Business account.

To get one, type “Google My Business login” into the search bar, select the first result and follow the instructions. Next time, I’ll take you through the set-up process and tell you more about how you can get the most out of your listing. In the meantime, if you have any queries, please don’t hesitate to ask. You can send your questions to me at jenny.barrett@nacfb.org.uk

“

Very quickly you’ll see it’s an extremely powerful tool for getting noticed

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Special Feature

HMRC takes preference Changes to insolvency creditor status Paul Goodman Chair NACFB

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hile businesses are rightly focussed on responding to the pandemic and planning as much as possible for our exit from the EU on 1st January, another deadline has just crept quietly past which will affect SMEs across the country.

Under the Finance Act 2020, HM Revenue & Customs (HMRC) regained its status as a preferential creditor for insolvencies which commence on or after 1st December 2020. This change in the rankings means that HMRC will now receive funds that would previously have been shared equally among unsecured creditors.

The reordering of who gets ‘first dibs’ on any funds doesn’t just have an impact when the worst happens, it also affects the amount of funding that businesses can receive by way of invoice finance and asset-based lending.

In the current climate of uncertainty, lockdowns and falling revenues, this change couldn’t have come at a worse time.

The impact of the new preferential creditor status for HMRC The change means that HMRC will join fixed charge creditors, employees and the financial services compensation scheme at the front of the queue for payment in any insolvency, leapfrogging both floating charge and unsecured creditors.

The preferential status refers only to VAT, PAYE, employee NICs and construction industry scheme deductions. All other taxes remain at the same priority level as other unsecured creditors.

22 | NACFB

Because HMRC’s claims will now take precedence over any floating charges held by secured creditors, the value of assets such as stock will be reduced in the eyes of lenders for use as security against a loan. This means that businesses could now see an immediate reduction in the funding available to them.

Increased risks for lenders and borrowers At a time when cashflow is perhaps one of the greatest pressures for many businesses, the banks will now have to decide how they will deal with this increased risk. They could choose to hold back or reserve a proportion of the requested funding – typically expected to be 20% of the amount requested or the equivalent of a business’ last month’s VAT and PAYE bill. Lenders could also choose to introduce the reserve over time so that there is no immediate impact on cashflow, but its implementation at some point is inevitable, and is likely to lead to a reduction in lending.

Colin Muir, director of invoice finance and working capital sales at NatWest, shared a lender’s perspective: “Funding against floating charge assets, such as stock, has been a useful mechanism for the UK SMEs for well over 15 years. The prior calculation of reserves for HMG, at 20% of realised assets up to £600,000 per legal entity, was clear and easy to calculate and reserve for with little additional diligence. This also maximised the funding generated for a business leveraging the asset base.”

Colin added: “With these changes coming in, moving forward, any form of asset based lending with a reliance on the floating charge will now require additional due diligence at the outset. The additional reserves may put pressure on cash flow for some companies going into Q1 2021 and beyond, potentially making this form of funding less attractive for some businesses as a result. However, this is a vital working capital stream and RBSIF remains committed to supporting UK SMEs via both fixed and floating charge structures with our market leading ID and ABL propositions, and we will be phasing in the additional reserves to support liquidity for our existing clients.”

Steps for businesses and brokers to take now Business owners and managers should speak to a specialist broker to review their finances and work out how to gain some headroom, for example, by adding working capital as soon as possible.

HMRC’s change in status will affect existing borrowers and those seeking finance now. It could become increasingly challenging to refinance with alternative lenders, and both invoice finance and asset-based lending might become more expensive.

The current economic situation around the country and complications such as lockdowns and furloughed staff add an extra layer of complexity and increase pressure on working capacity. For example, distributors and wholesalers selling into the hospitality industry

are more likely to use an invoice finance facility and therefore may place pressure on customers to pay quickly, at an increasingly difficult time.

When applying for finance, businesses may also have to provide more information on their tax position and any arrears, so that lenders can assess what proportion of a company’s assets may be handed over to HMRC if things go wrong. These assessments could negatively impact the final lending decision.

So, while the pandemic and Brexit may be the obvious concerns, brokers should think about contacting their clients to help them plan ahead before lenders fully get to grips with the potential impacts of the new rules.

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NACFB | 23

Special Feature

When finance can’t help How brokers can support insolvent SMEs ​Norman Chambers Managing Director NACFB

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here has been much written about the government’s financial measures designed to support businesses facing hardship during the coronavirus outbreak. When these come to an end, brokers need to be ready and waiting with alternative solutions – even if finance is not an option.

Coronavirus is still wreaking havoc on the UK economy to the extent that, in September, 64% of businesses said they were at risk of going under. It seems more than a little strange then that the number of businesses which went into liquidation nearly halved in Q2 and Q3 2020 (7,793) compared to the same period the year before (13,146).

Not only that, the number of businesses filing for Company Voluntary Administration (CVA) also more than halved (94 compared to 192) according to the latest data published by the Office for National Statistics (ONS).

The ONS also reported that 43% of businesses had less than six months’ worth of cash reserves and according to data from Red Flag Alert, more than half a million (557,000) businesses were suffering ‘significant distress’.

This decrease in the insolvency figures only makes sense when you dig a little deeper. Business restructures and closures have not yet increased for three main reasons: because of the time it takes; because of delays in the reporting process; and, perhaps more significantly, because the Government has introduced a multitude of support measures aimed at helping businesses survive.

Since the first lockdown this support has come in many guises.

There have been schemes, grants, loans, and reliefs available for businesses to use as a prop, to keep them trading in these difficult times. But much of this assistance has ended or is coming to an end, and sooner or later the public coffers will also be running on empty.

has been subject to an insolvency procedure in the previous 12 months, and an easing of access for companies subject to a winding-up petition.

Many market commentators predict that it will not be long before the country will be awash with companies going under – and the Government knows it too. It has done since the beginning of the pandemic. Therefore, in June, a new insolvency law was passed which included temporary measures available up to 30th September 2020, designed to increase the survival chances of a greater number of businesses struggling in the crisis.

The new law, called the Corporate Insolvency and Governance Act (CIGA), is akin to the Chapter 11 rules in the USA which help restructure organisations rather than liquidate them under Chapter 7.

Some interesting features of CIGA, include:

• Petition restrictions

Winding-up petitions and statutory demands remain restricted until 31st December 2020. These restrictions were introduced to protect companies from aggressive creditor enforcement action as a result of coronavirus related debts.

• Monitor and moratorium

An extendable 20 working day period of grace where no action can be taken against a company without a court order.

This moratorium is designed to strike a balance between protecting the interests of creditors whilst giving the company’s management time to develop a restructuring plan. To qualify for a moratorium, the company must engage the services of a monitor, i.e. an Insolvency Practitioner, who believes that the business can be rescued.

Temporary modifications to the moratorium procedure, which relax the entry requirements, have been extended until 30th March 2021.

They include that a company may enter into a moratorium if it

• Restructuring plan

If the courts deem that a restructuring plan would make creditors no worse off than if the company had gone into liquidation, creditors are invited to vote on the plan. If most creditors agree to the said plan, then all creditors are bound by it.

• Prohibition of termination clauses

If a restructuring plan or other insolvency procedure is in place, goods and services suppliers are unable to use contractual terms to jeopardise any agreed rescue package, i.e. they are not allowed to cease supply, (although there are measures available should the courts decide that the supply agreement would cause hardship to the supplier). This clause has been extended and now applies until 30th March 2021.

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The ONS also reported that 43% of businesses had less than six months’ worth of cash reserves and according to data from Red Flag Alert, more than half a million (557,000) businesses were suffering ‘significant distress’

NACFB | 25

• Suspension of wrongful trading liability

This part of the Act temporarily removed the threat to company directors of being held personally liable of wrongful trading through the pandemic. The Government’s aim of the suspension was to remove the pressure on directors to close businesses that would otherwise have remained viable had they not been impacted by the coronavirus. Unfortunately, this temporary measure ended on 30th September, despite calls for it to be extended.

Roger Barker, director of policy at the IoD, said: “Failing to extend the suspension of wrongful trading rules was a mistake. Without this protection, the pressure is on directors to simply shut up shop when faced with difficulty.”

Not part of CIGA, but included in the same announcement about measures which had been due to finish at the end of September, the Government revealed that businesses would continue to be protected from the threat of eviction until the end of the year, particularly those struggling to pay their rent due to the impact of COVID-19.

• Company Voluntary Arrangements

On the subject of rents, before the pandemic there had been a flurry of ‘landlord only’ Company Voluntary Arrangements (CVAs) by retailers seeking rent reductions. Most failed so it is unlikely that they will continue in any great volume. However, we are now seeing several different CVAs which seek to compromise the claims of other categories of unsecured creditor. It will be interesting to see how these pan out – and we’ll keep you updated.

Talking of CVA creditors, another thorn in the side of struggling businesses is the reintroduction of ‘Crown preference’. From 1st December this year, HM Revenue and Customs will rank as an uncapped secondary preferential creditor meaning that all outstanding tax liabilities must be paid in full before a business can enter into a CVA or other insolvency process (unless HMRC agrees to the contrary). In light of COVID-19, this is a blow 26 | NACFB

for struggling businesses who are likely to have already accrued a high level of tax liabilities, including PAYE deferrals, putting the possibility of a CVA out of reach.

• Pre-pack sales

In October, the Insolvency Service announced a potential new law that will require mandatory, independent scrutiny of pre-pack administration sales where connected parties are involved in the purchase. Pre-pack sales play an important role in rescuing viable businesses and can be a job-saver. The new law aims to protect the interests of creditors, the general public and the distressed company. We’ll keep you updated as this legislation progresses.

How the broker fits in What’s all this got to do with commercial finance brokers? Without wanting to sound preachy, it’s imperative that brokers give their clients the right advice even when they know that finance is not the answer. Instead of simply turning clients away, brokers should be prepared to signpost businesses towards organisations that can help. And they should be able to signpost with a good explanation of what the next steps for the business could involve.

Businesses – given the chance to restructure – may very well survive, which is a much better outcome than liquidation. But if liquidation is the best solution, surely it’s better that the broker has pointed the client in the right direction, rather than helping it to rack up more debt?

2021 is going to be a hard year for many businesses, particularly those in hospitality and leisure. Government support simply will not help everyone. Just because the immediate solution isn’t finance doesn’t mean that the client won’t return in future.

A business that restructures could go on to need finance.

A director of a liquidated company may try their hand at a new business, which might require finance. Both are more likely to call on the broker who told it to them straight and pointed them in the right direction.

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Special Feature

Funding future growth Understanding industry sectors and their finance needs

T

hroughout 2021, the NACFB will host a series of virtual forums designed to help commercial finance brokers expand their knowledge of a number of important industry sectors. These online events are available to all NACFB Members and are free to attend if delegates sign-up in advance.

In each forum, brokers will hear from a guest speaker, who is an expert in their field, on how the sector is structured and operates. The expert will examine the challenges and opportunities facing SMEs operating in the market and explain how finance can help them to survive and grow.

Forums include representation from select NACFB Patrons with an appetite to lend in that sector. They will outline the types and availability of finance and discuss how brokers can help to get deals over the line. In turn, brokers will have an opportunity to quiz the lenders on criteria, rates and terms, and how to put together a winning application.

For more information and to register for a forum, please visit nacfb.org/events

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These online events are available to all NACFB Members and are free to attend if delegates sign-up in advance

28 | NACFB

Professional Services Finance Forum

Property Investment Finance Forum Mortgage? Bridging? Development?

Refurbishment? Ground-up?

Part-complete? Successfully securing the right type of finance for investment property takes tenacity and expertise.

Brokers need to understand their clients’ business models and be able to identify quickly which lenders are active in particular sectors. How are deals structured and how long will the application process take before the client can draw down funds? This forum will expand brokers’ knowledge of lenders and products, help them to manage customer expectations and address the nitty gritty of getting deals over the line.

When?

Tuesday 9th February 2021, 9.30am-12.00pm Sponsored by Avamore Capital Tuesday 20th April 2021, 9.30am-12.00pm Sponsored by MFS Tuesday 2nd November 2021, 9.30am-12.00pm Sponsored by Precise Mortgages

According to a report published in February 2020 by the Department for Business, Energy and Industrial Strategy, the professional and business services sector provides high value, good quality jobs and adds £190 billion to the UK economy. Given this level of impact, it is vital that these firms are supported in their endeavours to innovate and grow. And we’re not talking the ‘Big Four’, rather the small and medium sized professional services firms that are situated the length and breadth of the country. This forum looks at what finance they need to maintain and expand their operations and how a good broker can help them to access the right solutions.

When?

Thursday 25th February 2021, 9.30am-12.00pm Sponsored by Funding Circle

Transport Finance Forum

Manufacturing Finance and International Trade Finance Forum Despite facing uncertain market access, currency volatility, supply chain interruptions, peaks and troughs in demand, and job losses, SME manufacturers are cautiously optimistic in the short-to-medium-term, according to the latest results of the Manufacturing Barometer survey. Finance could be the factor that determines whether they fail, survive or thrive and this forum will shed light on the differing funding options available. With a focus on lenders operating in this arena, their products, borrowing criteria, and application processes, brokers will gain a deep understanding of what it takes to successfully support their manufacturing clients’ financing needs.

Cars, vans, lorries, buses, tankers, diggers, tractors, cranes, trains, boats and planes, to name but a few vehicles, and yet all vital to the UK economy. It’s imperative that SMEs in the transport, haulage and logistics sectors keep their businesses moving forward. And that’s where a good broker comes in, identifying the right funding for a variety of commercial challenges from investing in vehicles and premises to releasing cash tied up in assets or invoices. With insight from a leading industry expert, this forum looks at the options available and how brokers can acquire the knowledge and relationships they need to steer their clients towards the right solution.

When?

Tuesday 11th May 2021, 9.30am-12.00pm Sponsored by Haydock Finance

When?

Technology Finance Forum According to the Department for International Trade, our technology industry is the third largest in the world and lies at the heart of the UK economy, underpinning most other sectors. From the established Cambridge-based businesses to thousands of start-ups, this industry is expanding quickly, and it needs investment to be successful. In this forum, we hear from an industry expert on where the market is heading, how these businesses are using different types of finance to grow their operations and develop new products, and how brokers can get in on the action.

When?

Wednesday 10th March 2021, 9.30am-12.00pm Sponsored by Lloyds Bank

Tuesday 6th July 2021, 9.30am-12.00pm Sponsored by InterBay Commercial

Private Rented Sector Finance Forum The number of lenders offering solutions to residential landlords continues to grow.

And as landlords expand both their portfolios and their experience in the private rented sector, their financing needs are not only increasing, they are also changing. Today, landlords need help with incorporation, tax, buying, selling, refurbishments, development projects, lettings, HMO management, and the cross-over world of mixed-use properties.

Savvy intermediaries position themselves not just as buy-to-let mortgage brokers but as guides and strategists, ready to steer landlords to the right lender with the right solution.

This forum looks at how brokers can make themselves indispensable to their clients.

When?

Thursday 9th September 2021, 9.30am-12.00pm Sponsored by Landbay

NACFB | 29

“

Forums include representation from select NACFB Patrons with an appetite to lend in that sector. They will outline the types and availability of finance and discuss how brokers can help to get deals over the line

Hospitality Finance Forum The hospitality industry has been one of those hardest hit by the pandemic and the future is still uncertain. A recent report in UK Hospitality reveals that 750,000 jobs could be lost without urgent government support. In this forum, we hear from a leading expert on where the industry is heading, how it might adapt to survive, and which lenders will find an appetite to fund hospitality businesses that are finding opportunities in a crisis.

When?

Retail Finance Forum

Thursday 21st October 2021, 9.30am-12.00pm Sponsored by Allica Bank

Construction Finance Forum

The pandemic is changing the shape of retail faster than the invention of the internet. When the UK fully exits the EU in January 2021, the way we shop could change again depending on whether or not we leave with a deal. Retailers, particularly SMEs, must remain agile to survive and adapt new ways of buying, storing and selling goods. Staying still is not an option; they’ll need finance and an expert broker to ensure that the funding fits the task ahead. This forum looks at the lenders operating in this space and how brokers can work with them to meet the needs of their clients.

According to the Government’s construction strategy, the construction industry accounts for approximately three million jobs in the UK. Many of these are in SME companies such as small-scale builders, alongside products and supporting trades service providers.

And while lockdown almost halted projects up and down the country, building is back and busy. In this forum we hear from an industry expert on the health of these SMEs and how they can utilise funding not just to survive but to grow. And we learn how brokers can help these businesses access the right finance to maintain cashflow, purchase or hire plant, and expand operations.

When?

When?

Thursday 23rd September 2021, 9.30am-12.00pm Sponsored by Together

Tuesday 16th November 2021, 9.30am-12.00pm Sponsored by Aldermore

30 | NACFB

Special Feature

Preparing your landlord clients Horizon scanning the buy-to-let sector Richard Rowntree Managing Director of Mortgages Paragon Bank

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fter overcoming the challenge of various policy changes mid-way through the last decade, 2020 has forced the Private Rented Sector (PRS) to show its resilience once again.

Landlords have navigated a difficult period, facing voids, and supporting tenants with rent holidays, but now enjoy strong demand in most regions.

As we look forward to next year, we are likely to see many more twists and turns but buy-to-let will continue to play an important role in meeting the UK’s housing needs.

Long COVID Nobody has a crystal ball with regards to coronavirus, but its impact will be with us for some time to come, particularly in how and where we choose to live. I would expect the trend for people to look for properties with greater space and a garden, balcony or access to green space locally to continue into 2021 – for both purchase and rent – as we come out of the second lockdown, creating upwards inflationary pressures for this type of property.

End of the Stamp Duty holiday The Stamp Duty holiday has been a key component of the housing market’s resurgence since re-opening in May. Bank of England 32 | NACFB

figures show that the 91,500 mortgages approved in September was the highest number since September 2007 and the focus for many brokers will be getting their clients’ cases over the line before the March 31st deadline.

With Zoopla estimating that 400,000 sales are in the pipeline, 140,000 more than usual, I suspect we will repeat the pattern of March/April 2016, when the Stamp Duty surcharge for buy-to-let was introduced, and completions will surge ahead of the deadline before falling significantly in the subsequent months. I would also expect completions to be weighted towards those regions with higher than average property prices – London, the South West, the South East and the East – as these areas will feel the greater financial benefit of the Stamp Duty cut.

It is worth noting that another government initiative, the Help to Buy scheme, will not be extended and this is likely to increase demand for PRS housing from would-be first-time buyers.

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Paragon analysis of landlord sentiment surveys shows that the pandemic will likely lead to almost a quarter of single property landlords exiting the PRS

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Reforms to planning are also reducing red tape to make converting commercial premises into residential easier

A shift towards remortgage business The popularity of five year fixed-rate buy-to-let mortgages started to increase in 2016, before accelerating rapidly in 2017 as a result of the introduction of new PRA underwriting rules. As these deals written five years ago start to mature, competition for remortgage business amongst lenders is going to intensify.

The rate of growth is clear. In 2014, there were an average of 1,462 five-year fixed deals completed per month. In 2015 that rose to 2,602, increasing to 3,386 in 2016, accelerating to 6,456 in 2017.

The remortgage of five year fixed-rate deals will be a rich source of business for the broker community and will provide stimulus to the market post Stamp Duty holiday.

Increased professionalisation of the sector Over the past few years, we have seen a shift towards a more professional Private Rented Sector and this will continue into 2021, likely accelerated by COVID-19. Portfolio landlords have both a greater commitment to the sector and a higher propensity to buy.

Paragon analysis of landlord sentiment surveys shows that the pandemic will likely lead to almost a quarter of single property

landlords exiting the PRS. Fewer than 5% of landlords with twenty or more properties expect the same fate for their lettings business. These larger portfolio landlords are also six times more likely to invest in the next 12 months when compared to those with just one property.

More complex business A continued trend for a more professional PRS will result in more complex buy-to-let business.

Research carried out this year by BVA BDRC shows that 76% of landlords with 11 or more properties intend to buy their next BTL property within a limited company. This is significantly more than the 40% of smaller landlords.

Reforms to planning are also reducing red tape to make converting commercial premises into residential easier. This, along with the changing face of the high street, no doubt accelerated by two lockdowns, presents opportunities for investors willing to look at innovative solutions to the housing shortage. With demand outstripping supply and a need for environmentally sustainable housing, there is potential for an increasing number of landlords to apply for loans to purchase properties that would fall outside of what we would typically consider residential stock.

NACFB | 33

Special Feature

Solid steps for uncertain times Future proofing your business in 2021 Simon Welling Director of Sales & Marketing Wesleyan Bank

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OVID-19 has changed the way business is done. As we adjust to the ever changing ‘new normal’, brokers and funders should be using the experiences of 2020 to develop a pandemic-proof strategy to drive business forward and withstand further local or national lockdowns.

Where are you today?

Carrying out a pragmatic review of your business may seem an obvious starting point, but one that may be hard to face. The review should include: • • • • •

Financial health Customer needs and expectations Supply chain Workforce needs and capabilities Adoption of digital tools and other process facilitators

It’s key to enter this with an open-minded, honest assessment of the challenges faced. Consider: • • •

What have we learned?

What would we do differently?

Has COVID revealed new opportunities for digitalisation of systems and processes or products that we hadn’t considered before?

34 | NACFB

Getting cosy with cashflow As finance professionals we all understand the importance of the numbers. It has never been more critical to know where the business stands financially. For example: • • • •

• • •

•

What revenue is expected?

Are there any impacts from the government stimulus packages?

How can you increase revenues more quickly?

What are the working capital requirements and fixed operational costs?

Are pricing structures still relevant?

What investment is needed to operate in a safe and secure manner?

Could investment in new digital technologies help efficiencies and profitability?

What levels of banking or alternative finance support may be needed?

“

The challenges of 2020 have given brokers a clear understanding of supply chain strength, with some funders going above and beyond expectations while others may have fallen short

“

Regardless of any trading agreement, acting now is vital for businesses wishing to continue to trade with the EU and even Northern Ireland

These answers provide a guide to potential cashflow generation, estimation of sales and forecast profitability and shape the vision and ambition for change.

expectations while others may have fallen short. Businesses should evaluate performances and consider whether the landscape has been impacted by the pandemic.

Don’t undertake the journey alone

Brexit – are businesses oven ready?

Businesses have learnt much about their staff during the pandemic; their flexibility in adapting to change; a willingness to work from home when needed; and their positivity and understanding when the chips have been down.

Unfortunately, no plans can ignore Brexit, especially for businesses with EU-based customers or goods delivered from the EU.

Recognising the impact that this could have had on mental health and morale is crucial. You should look to encourage a workplace culture which breaks down the barriers around discussing mental health and allow employees to express any concerns or worries.

Bridging the gap Harnessing digital technologies during the lockdowns has meant that staff can work remotely. For many businesses, the move to using more technology happened in days rather than the years it may normally take.

This experience has meant that there is an increasing recognition that digitalisation is an integral business enabler.

Whether deployed in your own organisation or in that of your customers, brokers and funders can find opportunity in the move to digital.

Strengthening the supply chain The challenges of 2020 have given brokers a clear understanding of supply chain strength, with some funders going above and beyond

Regardless of any trading agreement, acting now is vital for businesses wishing to continue to trade with the EU and even Northern Ireland. Things to consider include: •

Supply chains – Undertaking an audit of the supply chain to identify which goods and services come from the EU, as well as scenario planning for any delays which could affect production, costs, or revenue.

• Customs, tariffs, taxes – Customs declarations for imports and exports will be needed as well as considerations around VAT arrangements.

• Regulatory changes and data management – Keeping up to date with any changes to law and regulations that could impact business such as GDPR and post-Brexit regulations.

Planning for the new future The right planning and preparations will put you in the strongest possible position to face 2021. Specialist finance providers can support you and your customers, whether it is for short-term loan requirements to cover cashflow expenditure such as a tax, or for longer-term investments through loans or asset finance.

NACFB | 35

Industry Insight

Anticipating SME needs VAT loans can release vital cash flow Martine Catton Chief Commercial Officer Just Cashflow

I

keep hearing the COVID related phrase ‘we are living in unprecedented times.’ This is certainly true for UK SMEs that are having to battle against various lockdowns and, on many occasions, losing access to their customers virtually overnight.

They are also having to navigate their way through various government support schemes and are becoming increasingly aware that these are coming to an end and monies borrowed will have to be repaid.

Commercial brokers have a key role to play in helping business owners find the financial support they are going to need. I say this because traditional funders may find lending more challenging in Q1/Q2 next year, especially to those businesses that represent the ‘S’ in SME. Many lenders may have to focus their attention on collecting back the billions of pounds that have been lent during COVID. If reports are to be believed they will also be dealing with a high level of fraudulent applications.

Non-bank lenders like us also have a key role to play by anticipating the type of flexible finance facilities SMEs will need as they prepare to play a significant role in the UK’s economic recovery. Therefore, we have just introduced a new VAT loan facility.

All businesses appreciate it is important to pay their quarterly VAT 36 | NACFB

bills on time and HMRC shows little tolerance for late payments.

Most businesses set money aside for VAT bills they know are coming their way but inevitably there is the temptation to dip into that pot especially when faced with the type of pressures COVID has introduced. The government has recognised this with its COVID VAT Payment Deferral Scheme, but it only covers payments due between 20th March 2020 and the 30th June 2020. We are introducing our facility now, knowing it will be valued when the next and subsequent quarters’ VAT bills are due in addition to those deferred repayments having to be made.

Payments will inevitably come at a time when there will be increased demands on SME working capital and many may have needed to use their VAT savings pot. A VAT loan recognises that businesses will want to both pay their VAT bills as quickly as possible and free up valuable cashflow. Therefore, the loan is for a maximum three-month term.

We have factored into this facility’s design the fact that under the Finance Act 2020, HMRC regains its status as a Preferential Creditor for all insolvencies that occur from here on in.

Where a lender holds a floating charge, they will want to be sure HMRC is up to date and may even consider holding reserves monthly to ensure the client can meet their obligations. This could impact client cashflow on a regular basis. The ability to pay the VAT when it falls due; however, may mean the reserve may not be required, releasing much needed cash back into the business.

Owners of many excellent businesses are fighting hard to save and reinvigorate their businesses – the last thing they need or want to deal with will be HMRC when they need to be focussed on the future of their business.

BRO KER Our Business Development Managers understand that every deal is unique. That’s why they work with you and take the time to understand your client’s needs, providing tailored funding solutions to drive business forward.

a great deal

Talk to us today.

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Barclays Bank UK PLC. Authorised by the Prudential Regulation Authority, and regulated by the Financial Conduct Authority and the Prudential Regulation Authority (Financial Services Register No 759676). Registered in England. Registered no 9740322. Registered Office 1 Churchill Place, London E14 5HP. Barclays Bank UK PLC adheres to Standards of Lending Practice monitored and enforced by The Lending Standards Board. Further details are available at www.lendingstandardsboard.org.uk Item Ref. 9917163_UK. July 2020.

Industry Insight

The green farming revolution Moving towards a low carbon agricultural sector

Tony Geary National Head of Business Development Barclays UK

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cross the UK, the drive among farming businesses to become even more sustainable is gaining momentum.

The Government is putting a green recovery at the heart of its post-COVID-19 economic plan. In addition, the National Farmers Union (NFU) has set ambitious targets for carbon net zero farming by 2040. This is good news for tackling climate change and it makes good business sense too.

UK farmers are rising to the challenge and are already changing their business practices in response. New Barclays’ research shows two thirds of farmers place sustainability as one of their top priorities, and eight in ten say they believe they could be carbon neutral by as early as 2035. That’s five years ahead of the 2040 targets set by the NFU, which is really positive. In addition to this, one in six farmers say they believe they’ve already reached this goal, which I think is fantastic.

Of the farmers we surveyed, 65% say they are thinking about how to make their businesses more sustainable. They also believe becoming greener will increase the competitiveness of their farms after the UK has left the EU, indicating that Brexit could further accelerate the green transition. There is certainly plenty of optimism within the farming community on the subject of sustainability.

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Sustainability and competitiveness go hand in hand Investment in Agri-tech will drive efficiency, but also the way farmers address sustainability on their farms, and the money they invest will reflect their unique challenges. The solutions they implement are going to be varied too. To give a few examples, we’ve seen initiatives to enrich soil using organic matter, the use of drones, and the capture of data to help drive efficiency.

Farmers have also been investing in low emission vehicles and generating their own power from biomass, installing Combined

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New Barclays’ research shows two thirds of farmers place sustainability as one of their top priorities, and eight in ten say they believe they could be carbon neutral by as early as 2035

Heat and Power (CHP) and Ground Source Heat Pumps (GSHP) or using the natural resources of their landscape to invest in wind, solar or water power to support the sustainability objectives. Across the farming community, there is a huge range of projects requiring investment, and undertaking an energy or carbon survey can be the first step to really helping a business understand its position and move forward. Our research also shows that the average farmer is set to invest almost £200,000 over the next decade to achieve greater efficiency and become more sustainable.

As a further motivation for farmers to extend their sustainable practices, UK consumers are showing their willingness to support their efforts. There’s a growing appetite for more sustainably produced food, and shoppers are increasingly showing greener habits, such as purchasing from farm shops. Our consumer research indicates the average consumer is willing to top up their annual food spend by £192.40 for more sustainable produce. This translates to a £10 billion opportunity for the agriculture sector.

A greener future together In response to these trends, Barclays has recently launched £250 million in financial support for UK farmers to invest in sustainability through Agri-tech, and let’s not forget, on the ground support is more important than ever. That’s why we’ve trained all of our dedicated agricultural team on sustainability. The drive towards the NFU’s net zero by 2040 target requires commitment and co-operation from everyone involved in the rural economy, so this represents an important step. Investment in sustainability is an

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Our research also shows that the average farmer is set to invest almost £200,000 over the next decade to achieve greater efficiency and become more sustainable

exciting growth area for brokers to get involved in and we at Barclays are committed to helping brokers engage with their farming clients so they can better understand their unique requirements.

To find out more about sustainability within agriculture, you can listen to my ‘Let’s Talk Brokers’ podcast with Barclays’ head of agriculture, Mark Suthern, who highlights the types of sustainable investments being made across UK agriculture.

If you would like to discuss a client lending case or would like to become one of our approved brokers, contact one of Barclays’ BDMs. NACFB | 39

Broker Voice

Help us help you What we’d like to see from property lenders in 2021 Ed Ogden Managing Director Knox Capital Solutions

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aving sat on both sides of the broker/lender relationship during my career, I’m sure neither would disagree that 2020 has been something of a game changer. The need for adaptation and greater flexibility has never been more evident as COVID’s economic impact wreaks havoc on homeowners, investors, lenders, and brokers alike.

Current conditions Lenders have become more cautious due to the pandemic, resulting in lending volumes being down by as much as 35% in comparison to the previous year. Although this level of activity is significantly higher than that seen in the post-credit crunch lows of 2009, the reduced appetite has seen the LTV average being reduced to 50-55% and average margins increasing by 20-50 BPS. Many of the main clearing banks supported their existing customer bases with a focus on government-backed support schemes, such as the Coronavirus Business Interruption Loan Scheme (CBILS) and Bounce Back Loans (BBL).

In late summer, it was reported that house prices had soared to their highest for more than 16 years. This was prompted by several factors, including the suspension of Stamp Duty until March 2021.

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Rural property was particularly in demand as the realities of home working put a premium on space. Meanwhile, within the commercial property arena, the office market continued to remain active despite remote working.

There is still liquidity within the marketplace and the number of active lenders continues to steadily grow and clearing banks have started to return to the marketplace after their CBILS and BBL focus.

However, the relief on Stamp Duty is due to end next March, meaning that the current property bubble may well come under pressure during 2021.

Working together Having spent more than 30 years in the banking arena, before making the change to commercial broker, I understand only too well how these unprecedented times have impacted upon both sectors. While the desire is there to do business on both sides, and to provide clients with the highest levels of service, it will not be possible without collaboration.

A collaborative approach is just one of the ways I believe brokers and lenders can work together in 2021. Those who know me well will attest to the fact that, wherever possible, I like to keep things simple.

Other important factors in keeping things moving include:

1. Swift decisions – As brokers we fully understand that sometimes the answer is ‘no’, but it’s better to be advised of this at an early stage rather than further down the line. Equally, we are experienced enough to know that second opinions (where appropriate) can sometimes result in a win for the client.

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Always remember there is an individual at the end of the proposal.

Clients are the lifeblood of brokers and treating them well often means future business and wider recommendations

2. Clear timelines – A loan is not done until it has been drawn down. This year has taught us that delivery at the post-approval stage is almost as essential as the initial credit approval. Agree timelines at the outset with all parties and stick to them.

3. Static goal posts – If lending terms have been agreed, try and stick to them. Amending terms once professional partners have been instructed can potentially derail a transaction and result in disappointed clients.

4. Trust in valuations – Communicate a concise valuation instruction process for all relevant parties and utilise the valuation given. Do not instruct clients to pay for a valuation then not use that figure – valuers understand the landscape and their expertise should be trusted.

5. Strong communication – Ensuring that all parties in a transaction remain connected is vital. Set-up Service Level Agreements, provide regular updates, and obtain emergency contact details for anything unforeseen.

6. Personal approach – Always remember there is an individual at the end of the proposal. Clients are the lifeblood of brokers

and treating them well often means future business and wider recommendations.

7. Criteria clarity – The lending landscape is ever-changing and never more so than during a global pandemic. Providing brokers with regular updates on lending criteria can greatly assist in determining the most suitable lender for the deal.

8. Reliable processes – Having a clear understanding of what is required at an early stage is essential in identifying potential issues. As a broker we would expect lenders to stay connected with their back-office functions to understand the process at each stage.

9. Legal partnerships – Ensuring the client’s legal advisors understand the timescales, requirements and expectations involved can make a world of difference particularly when deals are time sensitive. Be pragmatic where possible and ensure all parties are on the same page.

10.

Broker support – Brokers have become an increasingly integral part of the debt cycle in working collaboratively for the benefit of the client. We can make a lender’s life easier through being the focal point to bring all parties together.

NACFB | 41

Broker Voice

Embrace the pivot Utilising asset finance to inspire new thinking Simon Knowler Director Direct Asset Finance Ltd

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e all want to make business growth more affordable and more accessible. And never has this been more important than in 2020, as businesses adapt to a global pandemic against a backdrop of planning and adjusting for Brexit.

The end of the year provides an opportune time to reflect on the challenges and impacts that COVID has had. Not just on our own businesses as commercial brokers, but also on the businesses we support, how they have been utilising finance to help adapt, build resilience and ‘pivot’ their business model into new markets and new routes to market.

When lockdown first hit in March 2020, I recall how the initial reaction was for the ‘shutters to come down’ – business owners had to take stock quickly of what was happening, what it might mean for them and what immediate actions and decisions they might need to take to best mitigate the situation.

But they moved quickly. In the face of adversity, SMEs showed their ‘true grit’, passion, courage, determination, and perseverance to face the situation – adapting quickly and identifying new ways of doing things.

Here at Direct Asset Finance, we have seen several key trends amongst the sectors we support, and I wanted to share those with you.

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Pivot to eCommerce Within the retail and hospitality sector, as venues closed, businesses moved quickly to establish an ‘at home’ offering, building eCommerce capability, home delivery and ‘click and collect’ solutions. For example, one restaurant client in London which started to make their own ingredients from their kitchens for ‘eat at home’ packs, now has 2,000 subscribers and is accessing ongoing finance solutions from us to continue to expand their delivery fleet.

Outsource to insource, offshore to onshore Many businesses saw their supply chain disrupted and in some cases this has accelerated plans for them to build their own in-house

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In the face of adversity, SMEs showed their ‘true grit’, passion, courage, determination, and perseverance to face the situation

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2020 has taught us the importance of having a resilient business model, one where we are not overly dependent on any one customer, any one market sector, any one route to market

production capability, partly in response to COVID and building future resilience, but also in response to Brexit.

own business has coped and adapted to what the world has thrown at us this year.

One business accelerated plans to build its own food production facility; in so doing bringing greater control to its ability to service new eCommerce distribution. Another sought to bring onshore manufacturing, building its own localised capability, rather than solely relying on bringing product in from Eastern Europe. Utilising asset finance has helped these businesses to free up the working capital to bring in the initial equipment and machinery to commence their own production.

Fortunately, we had already invested in our systems and processes, transitioning everything to the cloud, including our CRM, client case management, accounting systems and personal learning and development. This meant minimal disruption to our business as we closed the office and the team worked remotely. Rather than having to spend time internally managing our own challenges, this has allowed us to continue to be available to support clients with finance solutions to help them manage cash and working capital as they adapt themselves.

Growth opportunities For some, COVID has meant a significant upturn in demand. One of our clients runs a home delivery fulfilment/logistics business and has struggled to keep up with demand so he has utilised finance to rapidly expand capacity in his business to service the increase in home shopping and delivery.

Resilience COVID has highlighted those industries that remain more resilient to changes in market conditions and changes to consumer behaviour.

We have seen a steady, continuous need for finance from sectors such as utilities and key infrastructure sectors – those essential services that always need to continue.

It has also been a period for internal reflection, appraising how our

If one thing, though, 2020 has taught us the importance of having a resilient business model, one where we are not overly dependent on any one customer, any one market sector, any one route to market.

But also not overly dependent internally on any one member of staff.

Our business, processes and systems have been given a strong test this year and this gives us the confidence to continue to push ahead with our own growth strategy, as we look to build off our strong foundations, build an extended network of advisors, enabling us to make business growth more affordable and more accessible for an even wider range of companies.

For those who have had a taste of working from home, or have had occasion to reflect on where they are personally, we are able to provide a route for people to set up on their own, supported by the fact that we have done the hard work for them.

NACFB | 43

Awards 2020

AWARDS 2020

2020 WINNERS

Recognising industry excellence Two award ceremonies and two hosts in one big online celebration

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ow to hold a party during a pandemic? We turned this challenge into an opportunity by combining two, usually separate, awards nights into one – and took it online.

And what a night it was! Hosted by a (married!) couple of hilarious comedians, Marcus Brigstocke and Rachel Parris, the Commercial Broker and NACFB Patron Awards held on 26th November certainly was an evening to remember.

The night kicked off earlier than usual, with Members and Patrons logging in at 4pm to hear the NACFB’s Chair, Paul Goodman, welcome everyone, followed by a few choice words from the impeccably attired Andy Bishop of headline sponsor, Lloyds Bank.

Then it was straight over to Marcus for a wry reflection of recent events before moving onto the presentations.

The charity supported by the NACFB at the ceremony was CLIC Sargent which fights tirelessly to stop cancer destroying young lives by working hard to help when each child and young person needs it most. Thank you so much to all who donated on the night. The donations are still coming in, so we’ll announce the grand total in January.

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The party proved the NACFB is a true family, caring for each other and having fun despite challenging times

Then it was back to the awards before Marcus thanked all the event sponsors again for their unstinting support. It was their generosity which enabled us to hold such a successful night.

Drawing the evening to a close, NACFB managing director, Norman Chambers, thanked Marcus and Rachel, the winners, the shortlisters, the sponsors, the organisers and the guests. The party proved the NACFB is a true family, caring for each other and having fun despite challenging times. We look forward to doing it again next year, face-to-face if at all possible…

Commercial Broker Awards • Asset Finance Broker of the Year

• Commercial Mortgage Broker of the Year

• Motor Finance Broker of the Year

Winner: Radar Finance & Leasing

Winner: Arc & Co.

Winner: Charles & Dean

Shortlisted: Oracle Asset Finance, Radar Finance & Leasing

Highly Commended: Halo Corporate Finance

Shortlisted: Associated Commercial Finance, Charles & Dean, Portman Asset Finance Sponsor: Aldermore

Highly Commended: Bespoke Business Finance

Shortlisted: Crystal Specialist Finance, Finance 4 Business, Largemortgageloans.com, Mantra Consultancy & Capital, Vantage Finance

• Significant Contribution

Sponsor: Lloyds Bank

Winner: Kevin Jones, Omega Group

Winner: Knox Capital Solutions

• Deal of the Year

• SME Champion Award

Winner: Bespoke Business Finance

Winner: Claratus Commercial Finance

• Bridging Broker of the Year Highly Commended: Finance 4 Business

Shortlisted: Arc & Co., Ramsay & White, Vantage Finance, VIBE Financial Services

Highly Commended: PIA Financial Group

Sponsor: Together

Shortlisted: Bridgedevelopment Property Finance, Empire Finance, Finance 4 Business, Ignition Credit, Reservoir Finance

• Broker Innovation Award

Sponsor: InterBay Commercial

Winner: Synergi Partner Finance

Highly Commended: South West Business Finance

Shortlisted: Beta Commercial Finance, Rangewell, The Property Finance Guy

• Development Broker of the Year

Highly Commended: Christie Finance

Shortlisted: FTA Finance, Reach Commercial Finance

Sponsor: Allica Bank

• Sole Trader of the Year

Winner: Mantra Consultancy & Capital

Winner: Bridgedevelopment Property Finance

Highly Commended: Sirius Property Finance

Highly Commended: Xander Wealth

Sponsor: Haydock Finance

Shortlisted: Adapt Finance, Arc & Co., Finance 4 Business, Positive Commercial Finance

Shortlisted: Icthus Consultants, Next Step Asset Finance

• Buy-to-Let Broker of the Year

Sponsor: Avamore Capital

Sponsor: Landbay

• Factor & Invoice Discounter Broker of the Year

• Young Broker of the Year Award

Winner: Vantage Finance

Highly Commended: VIBE Financial Services

Shortlisted: First Union Mortgages, Jonathan Smith & Partners, Sanctuary Financial Planning, The Business Mortgage Company

Sponsor: Precise Mortgages

• Cashflow Broker of the Year Winner: South West Business Finance

Highly Commended: Agama & Associates

Shortlisted: Choice Business Loans, Christie Finance, Hilton-Baird Financial Solutions, Reach Commercial Finance

Sponsor: Funding Circle

Winner: Reach Commercial Finance

Highly Commended: Hilton-Baird Financial Solutions

Shortlisted: Beacon Finance, Claratus Commercial Finance, Go-Factor Sponsor: Ulimate Finance

• Leasing Broker of the Year Winner: Bluestone Leasing

Highly Commended: Halo Corporate Finance

Shortlisted: Landlord Smart, Portman Asset Finance

Sponsor: Shawbrook Bank

Winner: Nick Neophytou – Mantra Consultancy & Capital

Highly Commended: George Dunn – Approved Business Finance Shortlisted: Jake Baker – Peritus Corporate Finance, Jordan McBriar – Adapt Finance, Tom Savill – Arc & Co. Sponsor: Market Financial Solutions (MFS)

Broker COMMERCIAL

AWARDS 2020

NACFB Patron Awards • Socially Responsible Lender of the Year

• Asset Finance Lender of the Year

• Development Lender of the Year

Winner: Close Brothers Business Finance

Winner: United Trust Bank

Highly Commended: Haydock Finance

Shortlisted: Aldermore Bank, Lloyds Bank, Paragon Bank, Ultimate Finance

Shortlisted: Aldermore, Assetz Capital, Avamore Capital, Blackfinch Property, CapitalRise Finance, Magnet Capital, Maslow Capital, Shawbrook Bank, West One Loans

Highly Commended: CAF Bank

• Factor & Invoice Discounter of the Year

• Specialist Lender of the Year

Winner: Lloyds Bank

Highly Commended: Paragon Banking Group

• BDM Team of the Year

Winner: Allica Bank

Highly Commended: NatWest

Shortlisted: Arbuthnot Specialist Finance, Atom Bank, Barclays, Cambridge & Counties Bank, Funding Circle, Keystone Property Finance, LendInvest, Lloyds Bank, Octopus Real Estate, United Trust Bank

Highly Commended: Roma Finance

Highly Commended: Ultimate Finance

Shortlisted: 1pm plc, Bibby Financial Services

• Most Innovative Lender of the Year

Winner: Unity Trust Bank Shortlisted: Business Enterprise Fund, Hitachi Capital Business Finance, Lloyds Bank, Reliance Bank

Winner: Redwood Bank

Shortlisted: CapitalRise, Just Cashflow, Landbay, OneSavings Bank, Renaissance Asset Finance, ThinCats, UK Agricultural Finance, Wesleyan Bank

• Business Bank of the Year

Winner: Redwood Bank

Winner: Lloyds Bank

Highly Commended: Keystone Property Finance

• Unsecured Lender of the Year

Shortlisted: Allica Bank, Barclays, Fleximize, Funding Circle, iwoca, Lendhub, Lloyds Bank, Market Financial Solutions (MFS), Nucleus Commercial Finance, Shawbrook Bank

Winner: Funding Circle

Highly Commended: NatWest

Shortlisted: Barclays, Redwood Bank

• Buy-to-Let Lender of the Year

Winner: LendInvest

• Rising Star of the Year

Highly Commended: Precise Mortgages

Shortlisted: Barclays, Landbay, Lloyds Bank (BM Solutions), Paragon Bank, Shawbrook Bank

Winner: Jemima Hayes – Market Financial Solutions (MFS)

• CBILS Provider of the Year Winner: Funding Circle

Highly Commended: Barclays

Shortlisted: Assetz Capital, Atom Bank, Cynergy Bank, Hitachi Capital Business Finance, Lloyds Bank, NatWest

• Commercial Mortgage Lender of the Year Winner: Allica Bank

Highly Commended: Shawbrook Bank

Shortlisted: Cambridge & Counties Bank, InterBay Commercial, Lloyds Bank, YBS

Highly Commended: Annalisa Penge – Merchant Money

Shortlisted: Harry Hartnett – 365 Business Finance, Abigail Bailey – Barclays, Justin Madubuko – Barclays, Daniel Bondzie – Funding Circle, Kate Silcock – Lloyds Bank, Steven Bowes – Octopus Real Estate

• Short-term Lender of the Year Winner: Shawbrook Bank

Highly Commended: Market Financial Solutions (MFS)

Shortlisted: Bridging Finance Solutions, Hope Capital, LendInvest, Masthaven Bank, Roma Finance, Ultimate Finance, West One Loans

Highly Commended: Esme Loans

Shortlisted: 365 Business Finance, iwoca, Merchant Money

• Patron of the Year Winner: Allica Bank

• Significant Contribution Winner: Patrick Magee, British Business Bank

SPECIALIST SECTOR FINANCE: AGRICULTURE | AVIATION | HEALTHCARE | MARINE | RENEWABLES | TAXI | TECHNOLOGY

Finance for the pace of change

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01277 892 281 technology@shawbrook.co.uk shawbrook.co.uk/technology

Together

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Listicle

tips for a happy, socially distanced Christmas

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his December, the return of festive tunes to the airwaves is twinged with a touch of melancholy as many millions prepare for a markedly different Yuletide. Social distancing has put pay to lots of the season’s favourites; from the office Christmas party and hometown pub reunions, to doorstep carollers and the last-minute dash to the high street.

But it will be a memorable Christmas.

Festive warmth and cheer will go some way to shaking off one of the hardest years in living memory. To get you in the right frame of mind, we have compiled our top five tips to enjoy the festivities from a socially distanced perspective. However you choose to celebrate, the NACFB team wishes you a very Merry Christmas and a Happy New Year.

2. Swap a present for a charitable donation As the old adage goes: it’s better to give than to receive. Many of us don’t actually need to receive a gift to enjoy the festivities.

And more often than not, we’re given something we don’t want or will never use.

This year, when a loved one asks you what you want for Christmas, why not suggest they make a donation to the charity of your choice?

1. Send a real Christmas card

4. Walk on Christmas morning

Charities estimate that Christmas cards raise around £50 million each year for good causes. So, ditch the e-card and send out real ones to family, friends, colleagues and clients this year, especially to people who live alone or who may have struggled with health issues during the pandemic. If you have time, include a hand-written note to let them know how much you are thinking of them.

The bookies started declaring odds for a white Christmas back in October. At 5-4, Coral’s was perhaps the most optimistic.

But whether we get snow, sun, rain, wind, or a combination, if you can, get out for a walk in the fresh air on Christmas morning.

It’s good for body and soul and will help to work up an appetite for lunch.

3. Reach out to your neighbours Every year, millions of people expect to spend most of Christmas day alone.

This year, that figure is likely to rise owing to coronavirus restrictions. We might not be allowed in each other’s homes but that shouldn’t stop us reaching out to neighbours, particularly those who live alone. A phone call, or a doorstep chat (at a safe distance), bringing a little festive cheer could make all the difference.

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5. Watch the Queen’s speech This year the Queen will deliver her 68th Christmas Day speech but will she declare another Annus Horribilis? Perhaps the best we can hope for is that she does not make her broadcast from the press room at No. 10 Downing Street flanked by chief medical officer, Prof. Chris Whitty, and chief scientific adviser, Sir Patrick Vallance.

Next slide please…

Five Minutes With

​ ive F Minutes with: Lucy Painter Lucy Painter Director FUNDING ROUND Describe your role in ten words or less?

Varied, challenging, stimulating, fun!

That’s a small business for you.

How do you make a difference?

Whilst the rest of the team have years of experience in finance, I don’t. This means I view our opportunity and challenge through a different prism, and it helps us to question why. I know this has resulted in us supporting clients in ways which have bucked the trend.

In your view what are the key elements to a successful deal?

Candidness, attention to detail, tenacity and diplomacy when guiding clients down the route to success rather than the one they thought they needed.

What recent professional accomplishment are you most proud of?

It has to be growing the business through the pandemic – juggling work and homeschooling through lockdown was no mean feat. The team worked so hard 50 | NACFB

to achieve this and at some point, we will stop and celebrate our accomplishment.

team, and lockdown proved we are a great team even in the face of adversity.

What are the key elements to maintaining a strong lender/broker dynamic?

What changes do you hope to see in the ‘new normal’?

Candid communication. As a small broker we can’t offer the volumes a lender ideally might want to see – yet! But we do offer strong core values and professionalism with specialist expertise which means when a lender receives a proposal from us, it’s typically right for them. That’s why we prefer talking with lenders and underwriters, rather than depending on portals and algorithms.

What has been your lockdown essential?

Female company (via Zoom clearly) was key to keeping sane. Living with my husband, two teenage boys and a dog (also male), I quickly recognised how important girlie chat was. My business partner, Julia, is a key part of that – we work so well as a

I hope we retain the strong sense of community spirit and the renewed interest in local focus as we move into the ‘new normal’.

What is your favourite piece of management/leadership advice?

Failure to plan is planning to fail. The team will smile when they see this!

Which person has inspired you the most?

Living in Lincolnshire close to Sir Isaac Newton’s birthplace of Grantham, I have come to learn more about him and the breadth of his radical thinking across maths, theology, astronomy and physics.

His lasting legacy is so much more than what you learn in your science lessons.

Celebrating 10 years of specialist lending solutions

Buy to Let Mortgages for complex cases Here at Precise Mortgages we’re proud to help landlords with complex lending needs as well as those who have been underserved by high street lenders. Whatever their circumstances we have a broad range of specialist lending solutions.

HMOs Available up to 6 beds

Limited Company Landlord No limit on number of shareholders under the age of 21, subject to them being a director’s dependant

5 year Fixed rates Affordability assessed at pay rate

Portfolio landlords A dedicated team to do the heavy lifting for you

FOR INTERMEDIARY USE ONLY.

Contact your local BDM 0800 116 4385 precisemortgages.co.uk

Precise Mortgages is a trading name of Charter Court Financial Services Limited which is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority (Financial Services Register Firm Reference Number 494549).

Registered in England and Wales (company number 06749498). Registered office: 2 Charter Court, Broadlands, Wolverhampton WV10 6TD.

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