•  
• Tweet
•  
•        Print
•  
•         Track Keywords
•  
• 

Bailey McCann, Opalesque New York:

Asset-backed lending is starting to heat up again after a prolonged credit squeeze. The Financial Times reports that a record £18.9bn was borrowed from asset-based lenders in the three months to the end of June. Much of this lending is driven by advancing a line of credit against unpaid invoices. This type of specialty finance has emerged as the answer for small businesses that are having a hard time getting more traditional loans and lines of credit as banks refuse to take the balance sheet hit on small loans.

In August, the Commercial Finance Association (CFA) released its Quarterly Asset-Based Lending (ABL) Index Q2 2014. That data showed that U.S. businesses utilized 43.1% of their credit lines during the 2nd quarter, a total increase of 5% from the first quarter and an increase of 1.6% over the same time last year. While the increases are welcomed by the industry players, small businesses are still well below pre-crisis credit levels.

Against this backdrop, new, non-traditional players are coming to market with funds aimed at providing capital solutions for small businesses. Non-bank lending gets around some of the balance sheet issues faced by the big banks, although the terms can often be considerably different than one might see from a bank.

Connecticut-based Old Hill Partners recently launched its Asset Income Fund which targets asset-based lending for small to medium sized businesses. "We believe the ......................

To view our full article Click here