The expertise and support required by a variety of borrowers has amplified over the past few years due to a host of economic and market factors. Factors which have also been influenced by global events such as the pandemic and various geopolitical issues.

This heady mix has served to shine an even more prominent light on the advice process over this period, and the additional help required by intermediary firms from their strategic partners and support network to meet ever-evolving client demands.

Focusing on the commercial mortgage market, a reported 345,000 businesses across the UK shut their doors for the last time to highlight the strain being placed on a variety of firms. However, we are seeing sustained activity in the commercial and semi-commercial lending spaces with SMEs recognising the chance to take advantage of lower interest rates than were available last year.

This was acknowledged in Atom bank’s ‘SME Pulse’ survey for Q1 2024 which showed that 62% of brokers with SME clients have seen an increased appetite for external financing. This was in sharp contrast to the 45% of brokers reported in Q4 2023 iteration.

The survey also pointed out that purchasing a property has become a more powerful driver for SME borrowing, accounting for almost half of the loans taken out by businesses. That represented a notable increase from Q4 when it was the purpose of a third of SME loans, suggesting that businesses across the country view present market conditions as a being a good time to secure premises. Refinancing existing debt has also grown in popularity, representing nearly a third of loans (up from 21%), ahead of growth and business expansion (17%).

In addition, almost one in four broker respondents said their business clients had experienced difficulty in accessing funding, although this signified an improvement from the Q4 survey when almost a third reported accessibility problems.

This improved accessibility is a highly positive trend and demonstrates the appetite for business from lenders across this sector. However, one in four still represents a significant number. One of the ways to overcome this burden is for SME’s to gain a stronger, more in-depth understanding of their available funding options. Presenting a more detailed business picture and plan can also help overcome a number of funding barriers. Such an approach can often prove a key element in helping the lender gain stronger insights into historic performance, potential and future plans of the business.

To further bolster these numbers, it’s also vital that businesses and advisers appreciate the value attached to specialist commercial packagers with vast experience operating in this sector, especially for those advisers don’t have the time or knowhow to do this themselves.

In a cut-throat retail market, the winners will always be those firms who know exactly what their consumers want and successfully deliver it. This is also the case when it comes to securing the most appropriate form of funding.

Specialist packagers recognise the unique qualities of individual lenders to access bespoke, customer-focused financing solutions and have a full understanding of the information required to submit applications which will provide a smooth and efficient process to obtain the funds required. Therefore leaving the lender with a relatively simple decision. We also operate alongside third parties such as solicitors and surveyors to ensure the legal and valuation process is expeditated within the required timeframes. Meaning that working closely with such specialists remains arguably the simplest and most effective way to improve those accessibility issues.

Donna Francis (Née Wells), Managing Director at Envelop