Supporting Cash Flow in the Retail Sector

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Our client runs a 24-hour convenience store in Hammersmith and, as their business had grown over the last 12 months, they had taken out a number of loans. In an effort to support cash flow during the period of rapid expansion, the client had accepted a number of loans at high interest rates.

These high rates were coupled with inflexible repayment structures. As the business continued to grow, the monthly payments were putting the client back into financial difficulty.

Although the business was fundamentally profitable, cash flow was making the current position impossible to manage.

The Solution

By undertaking a detailed review of the client’s current borrowings and carefully plotting a better route forward, it became clear that a refinance of the existing loans was the best option. This would allow us to reduce the interest rates charged and movethe debt over to a more affordable monthly payment.

The refinance involved transferring the debt onto a new unsecured business loan, over a term of five years. This would allow the client to improve cash flow and avoid the need to keep taking on new debt due to a lack of working capital throughout the month.

After comparing rates from across the market, we quickly identified a lender and were able to issue indicative terms to the client. They were happy to proceed, and the application was fully submitted to the lender.

The loan completed in under a week, releasing a small amount of money to expand the business and the rest was used to repay the existing debts.

Loan Offer

  • Loan Amount – £80,250.00
  • Interest Rate – 21.9% per annum
  • Term – 60 months (5 years)
  • Monthly Repayment – £2,211.86

About The Author

This content was produced by our Commercial Lending Director, Gary Hemming. Gary has over 15 years’ experience in financial services and specialises in bridging loans, commercial mortgages, development finance and business loans. He is widely respected in his field and regularly provides expert commentary for specialist trade publications, specialist business press as well as local and national press.

Gary Hemming CeMAP CeFA CeRGI CSP  -  
Commercial Lending Director

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