Broker uptake drives 57% trade finance spike at Grow

According to the group, this spike in demand came following an increase in broker uptake, alongside strong market conditions.

Sectors that were found to be particularly driving demand for both facilities included:

• Health and personal care services
• Transport and logistics
• Manufacturing 
• Fast-moving consumable products (including food)

In addition, Grow found that many businesses were using invoice finance to “smooth out cash flow gaps” from slow payers or customers requiring extended credit terms to support business growth. 

Co-chief executive Greg Woszczalski commented: “The appeal is that as the turnover increases, so does the invoice finance facility as it complements each other being part of the security on offer.”

David Verschoor, also co-CEO of Grow, added that the shift by businesses seeking to support their cash conversion cycle using trade and invoice finance was “compounded by the fact that the facilities are linked to the specific asset being financed, as opposed to the requirement of tangible security – which most other financing facilities require. 

“Consequently, more and more businesses are adopting the debt structures as they provide much more flexibility and clarity when managing their working capital finance.” 

Looking forward, Grow said it expects that demand will continue to grow to help SMEs prepare for any “sustained challenges and headwinds”. 

“Growth in both sectors will be sustained by supporting brokers via national BDM presence, progressive team extension, product enhancements and careful credit management,” Mr Verschoor concluded.

The SME lender has been experiencing strong growth this past year, and recently expanded its leadership team, aggregator partnerships and product range.

In April the lender expanded into agri lending and then in June, it launched a low-doc asset finance product and joined the AFG lender panel. 

Earlier this month, it announced that it had built out its structured finance presence further, appointing Ryan Armstrong as its first senior partner, head of structured finance operations.

According to Grow, Mr Armstrong’s role will be heavily focused on “streamlining operations to facilitate greater scalability” and enhancing the lender’s tech platform to expedite funding. 

Grow has said that the establishment of this position is part of a broader team extension to “manage increased deal flow, improve service levels, and ensure brokers are well supported”. 

[Related: Grow extends structured finance leadership]