New scheme to address cash flow, credit and investment needs of SMEs
See analysis: Trading on good credit
Towergate Partnership has launched a new trade credit insurance scheme designed to address the cash flow, credit and investment needs of small and medium sized businesses (SMEs).
The scheme provides protection to SMEs which trade on credit terms with other businesses and provides cover against losses arising from the non-payment by customers. It also includes a debt collection and credit rating service. According to recent research 18% of UK businesses fail because of bad debt.
The new scheme is in response to a wider Government initiative announced by Lord Mandelson to help small businesses through the economic downturn.
The scheme from Towergate comes at a time when only 20% of UK businesses have trade credit insurance in place. Latest ABI figures also show that as the economy worsens, more businesses are in need of trade credit insurance policies. In Quarter 3, 2008:
• The total number of claims was 6,805, an increase of 34% from 5,084 in Q3 2007.
• The total value of claims was £97.0 million, an increase of 58% from £61.4 million in Q3 2007.
Amanda Blanc, chief executive of Towergate Risk Solutions said, “At a time when many credit insurance policies are being withdrawn from the market, Towergate is playing its part as a key supporter of local small businesses. In these unprecedented times we believe it is important to provide protection to local companies to secure the finance they need, not because of any failure in their business but due to the tougher credit conditions.”
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