FUNDING Options has teamed up with Experian to bid for a share of a Royal Bank of Scotland (RBS) fund aimed at boosting competition in the business banking market.
The online business finance marketplace – which connects small firms with a range of lenders, including peer-to-peer platforms – has partnered with Runpath, a part of global credit reference agency Experian, to develop a cash flow management tool.
The new solution, called Totem, will help small businesses to manage their VAT bills and invoices, check their credit report and score and identify any upcoming dips in cash flow, Funding Options said.
RBS’s £775m alternative remedies package was set up as one of the conditions of its £45bn state bail-out during the financial crisis. It includes a £425m capability and innovation fund, granted to entities that are improving banking capabilities for smaller firms.
The new cash flow tool, which will be free, will use Open Banking data to provide small business owners with greater insight into their financial situation.
A new survey commissioned by Funding Options of 500 small business managers found that 44 per cent worried if they had enough cash to keep going, while 72 per cent said a loss of income would be the biggest threat to the stability of their business.
“Small businesses are the backbone of our economy and yet the financial products and services that are available to them are far behind those that are available to consumers,” said Ryan Edwards-Pritchard, managing director at Funding Options.
“For too long, small business owners have been undervalued and underserved. Open Banking is a crucial step in changing this and giving small business owners more control of their finances. We want to offer products and services that help small business owners walk tall, allowing them to manage their day-to-day activities with the confidence that comes from foresight and planning.”
“Cash flow is a crucial issue for SMEs – it can hamper their growth, and all too often put them out of business,” said Matt Dunn, B2B GTM managing director at Experian.
“Working with Funding Options, we’re creating a tool using Open Banking and management account data which will put directors in control of their financial information.
“It is a striking example of how new financial services technology can provide new solutions for businesses, allowing them to make better decisions which will benefit both them and their customers. We are delighted to have partnered with Funding Options and look forward to seeing the outcome of our application.”