Large Business To Shift Towards Invoice Discounting

More large businesses will begin to use invoice discounting and asset-based lending over the next ten years, according to Ted Ettershank, managing director of Lloyds TSB Commercial Finance Ltd and Lloyds TSB Asset Finance. Ettershank told senior receivables finance professionals his prediction at this year’s Receivables Finance International conference in Copenhagen, run by BCR Publishing. In his presentation on the future of factoring, Ettershank looked towards the US market as a model for asset-based financiers in Europe. He suggested European asset-based financiers adopt the strategy of US companies who work in clubs and syndicates to spread the risk. These ‘club deals’ total US$144 billion, 42 per cent of the Commercial Finance Association’s US$340 billion total lending. Ettershank added, ‘This is not to say that all our clients in 10 years’ time will be big international businesses, far from it. I still believe that the majority, in number, of our clients will be small or mid-market businesses.’

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