The Business Secretary Claims That Banks Are Unwilling To Lend To Small Enterprises So This Could Make A Late Invoice With A Large Firm A Much More Urgent Priority.

A report by Will Smale who is a Business Reporter for the British Broadcasting Corporation entitled “Bank lending to small firms still a mixed picture”, cites a recent interview with Vince Cable, the Business Secretary as saying to the effect that finance houses are stating that they are offering financial help but small organisations aren’t interested, but that isn’t right. Mr Cable continues to say that the bar has been set too high and no one is prepared to jump. This is in reply to the fact that the finance houses are setting interest rates high and discounting this as a factor in the lack of takers for their business finance deals. For a small enterprise that is getting short of cash because of an unsettled account with a large enterprise this could well feel like a catch 22 situation. If after getting hold of the large enterprise they don’t get a suitable response they could feel that their only hope is Debt Collection to try and get the account paid. Not surprisingly, if the small enterprise used RBS or Nat West then they could have been given financial support as these are state supported finance houses, but even so these finance houses will still look at the business viability when scrutinising any applications for business finance facilities, so getting this account paid is a priority.

The options that are available for Debt Collection are really one of the usual options such as Debt Collection Agencies or legal practices which specialise in commercial Debt Collection, or a more hands-on strategy of Debt Collection Software. As cash is an important part of the decision for the small enterprise, this could rule out Debt Collection Agencies and legal practices as their fees are in the range of 10% to 20% or more of the account value. Debt Collection Software on the other hand costs around £40 for a decent application. There are some other important points on the financial side, in that the Debt Collection Agencies and legal practices deduct their price from the account after settlement, whereas typically the Debt Collection Software would have to be paid for, unless it was bought from a credit supplier. Also, the Debt Collection Agencies and legal practices will charge for each debt they take on whereas the Debt Collection Software is a one-off purchase and can be used as often as the small enterprise likes with no further fees to pay.

Using Debt Collection Software demands that the small enterprise assigns use the Debt Collection Software application and also to create the Debt Collection letters. As it is likely that the small enterprise has little or no experience of Debt Collection they could well depend on the documentation that comes with the Debt Collection Software. This should provide them with a clear description of how the Debt Collection procedure works and the important role played by Debt Collection letters. For these Debt Collection letters the documentation should explain any current laws that can be used and also any good phrases as used by Debt Collection Agencies that could help to get the large enterprise to pay the unsettled account quickly.