Invoice finance and asset-based lending stood at £23.4bn at the end of 2017, a 5% increase on the funds advanced at the end of 2016, according to figures published by UK Finance.
However, despite the increase in lending, the number of consumers remained stable at approximately 42,000.
Invoice finance and asset-based lending to small businesses with an annual turnover of below £500,000 increased by 19% in December 2017, compared to the same period the year before, with advances worth £833m.
Furthermore, annual sales of clients supported by invoice finance and asset-based lending stood at a record £311bn in 2017, a 4% increase compared to 2016.
UK Finance director of invoice finance and asset based lending Matthew Davies commented: “These figures show a continuing increase in the use of invoice finance and asset-based lending, particularly amongst smaller firms.
“This reflects a growing appetite for finance amongst those small businesses that are already using external funding.
“These forms of finance can provide extra flexibility and improved liquidity for firms, unlocking working capital to help them grow and invest as well as allowing them to support their own suppliers.
“The industry will continue to work to increase awareness amongst businesses about the different sources of finance that might be appropriate for them.”
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