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Alternative Business Funding

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Alternative Business Funding Ltd (ABF), owned by Clifton Asset Management Plc is a business funding comparison portal which helps SME Owners/Directors source finance to fund cashflow or business development. 

History[edit | edit source]

As the UK’s first collaborative SME funding website, ABF was launched in March 2014.[1] by Founder, Adam Tavener - Chairman of Clifton Asset Management Plc and innovator of the Pension-led Funding model – along with six of the UK’s major non-bank funding providers.

At the time of launch, ABF was backed by then Secretary of State for Business, Vince Cable[2], at the 2014 Alternative Finance (AltFi) Summit in London.  His statement that: “the launch of a portal that redirects people who are turned down by one lender is an advance,” reflected the alternative finance industry’s view at time, led by Tavener, that High Street banks should collaborate with alternative funding providers to solve SME funding needs. Additionally, if a bank rejected an application it should, by law, refer or collaborate with other funders to find a solution. 

During 2014-15 the ABF team led and co-ordinated the alternative finance sector’s response to the Bank Referral consultation[3][4] – supported by the British Bankers Association, CBI, ICAEW and other business groups.  The result was the launch of the Bank Referral Scheme on 1st November 2016[5]

In August 2017, HM Treasury, acting on the advice of the British Business Bank, announced that from 1 November 2017, ABF would join the Bank Referral Scheme[6] as one of the Government’s three designated finance platforms. By January 2018, the ABF portal included 120 funding partners, including high street banks and the majority of alternative business funding providers.  ABF also continues to advise SMEs on how to secure business funding at both a national[7] and regional [8]level and Adam Tavener remains an advisor to the UK Government and funding institutions.

How a designated online funding portal works[edit | edit source]

Designated Funding Portals are designed to offer simple online interfaces that allow discovery and comparison of the most appropriate business funding choices. Portal design also includes sophisticated data security to protect information exchange between the SME and the potential funding provider. The Competition and Markets Authority's (CMA) Final Report on Digital Comparison Tools (DCT) Market Study has influenced the design and continued development of the ABF portal. The report identified four key elements required to enable DCTs to realise benefits for consumers. These are:

  • Trust and confidence to use the Tools
  • Relevance and accuracy of service
  • Effective competition between DCTs
  • Proportionate regulation to support these three factors if the market does not deliver them on its own

While design and functionality differ slightly for each portal, the ABF process (named ABF Funder Finder) is as follows:

Step 1 – The SME Owner/Director enters the amount of funding, period of time and how soon funds are required.

Step 2 – The portal presents a number of simple, business-related questions, with the ABF system ruling potential finance providers in or out in real-time, depending on the answers. When all the questions are completed, the SME owner is presented with funding providers that are a potential match for their requirements and, where possible, ABF will offer a 1-2-3 ranking for more exact suitability.

Step 3 – The business owner can now choose to move forward or not. By moving forward, the business owner can choose as many of the proposed funders as they wish, maximising the opportunity to secure a funding deal. Regardless of the number of potential funders selected at this stage, there is no impact on the SME’s credit rating.

Step 4 – The business owner is contacted by one or more of the selected funders interested in taking the deal forward.  It is possible that, while the system identifies potential funding matches, none of the providers selected by the business owner are willing to make contact and progress the deal. Again, this does not affect the SME’s credit rating.

The ABF Partnership Programme[edit | edit source]

The ABF Portal uses cloud-based technology to run the matching process. Using the system’s Application Programming Interface (API), ABF created a Partnership Programme soon after the launch of the Portal. This allows professional organisations – such as accountancy firms and business funding advisors - to incorporate the ABF Funder Finder into their own client-facing websites and portals. ABF funding partners currently include: The Forum of Private Business, The UK Business Angels Association , Sage Group, International Association of Book-keepers, and CardOneBanking

References[edit | edit source]

  1. "New SME finance portal launched". Retrieved 2018-08-06. 
  2. Pension-Led Funding (2014-06-25), Former Business Secretary, Vince Cable, speaking at AltFi Summit, retrieved 2018-08-06 
  3. "SME finance: help to match SMEs rejected for finance with alternative lenders". GOV.UK. Retrieved 2018-08-06. 
  4. "George Osborne throws a lifeline to firms rejected by banks". This is Money. Retrieved 2018-08-06. 
  5. "Government announce launch of Bank Referral Scheme". Small Business. 2016-11-01. Retrieved 2018-08-06. 
  6. "HM Treasury selects ABF to help improve access to finance". Business Matters. 2017-08-11. Retrieved 2018-08-06. 
  7. Evans, Peter (2017-12-03). "Teach yourself to . . . deal with a bank loan rejection". The Sunday Times. ISSN 0956-1382. Retrieved 2018-08-06. 
  8. "What is open banking and how will it affect businesses?". www.southwestbusiness.co.uk. Retrieved 2018-08-16. 


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