Traditional commercial finance does its job. When you have time, and you need a term loan or equipment finance, it looks at the plan and the financials, and takes the weeks that takes.
That’s how it works when everything goes to plan. But what about when it doesn’t? That’s where ABL comes in.
Banks can’t see what your client owns. We can. So we ask two questions. What’s the asset, and how much do you need. Three things have to be true for a deal to work, and you can check all three before you pick up the phone.
The Friday problem
You know the one. Your client has payroll on Friday, or an ATO bill with a date stapled to it. The bank is “reviewing the file.” The clock is not reviewing anything.
Nobody did anything wrong, either. A customer paid late, or a cost jumped, and it wasn’t in anyone’s plan. Plans break. That’s business, and it’s the deal we’re built for.
What this actually is
Need a fast, reliable answer? Skip the new term loan. Your client needs time. A bank loan funds a plan. This covers the gap between a bill that’s due now and money that’s on its way.
Your client has a receivable that hasn’t landed, or a deal that hasn’t settled, and a date that won’t wait. We lend against something they already own so they can get across that gap, repay us when the money arrives, and carry on trading. Brokers, it keeps your client standing while the thing you’ve been working on comes through. Business owners, it keeps the doors open and the business yours.
This is what asset-based lending looks like at its simplest. You own an asset with value in it. You need short-term cash. ABL releases that equity for the loan term, secured against the asset, and the security is released once the loan is repaid.
Traditional commercial finance, and what we do
We’re commercial finance too. We just do the part the traditional model can’t, which is the day the plan breaks.
Traditional commercial finance
- Looks at the plan and the financials.
- Takes the weeks it takes.
- Built for growth, equipment and a long term, when everything goes to plan.
- Often lands on a “we’ll see.”
What we do
- Looks at the asset in front of us today.
- Moves as fast as your client can make the asset available.
- Built for the gap when the plan breaks, typically 1 to 3 months.
- Gives you a straight answer, even when it’s no.
Three things have to be true
Here’s the whole checklist. Seriously. If all three are true, we have an answer, and there is no grey in how we get there.
- There’s an asset of value we can secure against. We don’t hand you a list of approved assets, because lists are how good deals get ruled out by mistake. A truck or a boat, plant and equipment. If it has value and we can secure against it, we can lend against it. Property is the one thing we leave alone.
- It’s owned outright or mostly paid off. The business owns it, a director owns it, or a third party does. All fine. A small balance still owing? We can add the payout to the loan. If the asset needs to keep earning, it stays at work through Track It. If your client doesn’t need it day to day, it goes through Park It and we hold it.
- There’s a way out. Most of the time your client needs time, and time is what they’re buying through ABL. The way out is usually already in sight. The receivable they’re waiting on lands, or the deal settles. That’s typically one to three months, extendable to nine if you need it. Exit any time after month one with no penalty, and pay only for what you use.
What the bank can’t see
Banks love the plan. When it breaks they pull back, which is awkward when the plan breaking is the whole reason you’re calling. What they can’t see is what your client already owns. We can. We don’t need financials or a credit score to give you an answer, only the asset in front of us today.
Banks evaluate based on plans. When the plan breaks, they pull back. ABL exists because plans break. We don’t care about the plan. We care about the collateral you have right now.
“But how fast?”
The clock isn’t on us. It’s on your client. The second they can get us the asset, we move. Our record is six hours, enquiry to funded. That’s how urgent the need was on that deal, and it shows you how we move and how seriously we take what we offer. It’s a record, not a promise. Every deal starts with a free desktop valuation of the asset.
No maybes
We’re not in the business of maybes. We’re in the business of getting your client what they need, and on most of the calls we take, we can help. If there’s an available asset of value we can secure against, we do the deal.
When we can’t, you get a straight no, which is still no grey. It means you can move your client on quickly instead of waiting around for a “we’ll see.”
When to think of ABL
You don’t have to work out whether we’ll fund it. That’s our job. Yours is spotting the deal.
- A good business having a bad week, because something wasn’t in the plan.
- A hard date, and a bank that is still “reviewing.”
- A client who owns something valuable and has nowhere to point it.
- An ATO bill or a payroll run that can’t wait for a refinance.
When, not if
Urgent cash flow hits every business. A customer pays late or a cost jumps. It’s when, not if, and when the unexpected happens you need a plan B.
So find out before it hits. Talk to our team today and ask for a free desktop valuation of what you own. Nobody is rushing anything. You just get to know what’s sitting inside your assets and what you could ask for, so when the Friday problem turns up, you already have the answer.
One question. Is there an asset of value you would put up to solve this?
If yes, call your BDM, or call us directly if it’s your own business. Not sure? Send it anyway. Worst case you get a straight no, and that’s useful too.
When you have an asset,
we have an answer.
Send us the basics. What the asset is, who owns it and how much you need. You’ll get a straight answer, not a ‘we’ll be in touch.’