Contract Finance focuses on business with annual turnover of more than £250,000 which supply goods or services under contracts, typically over a set period of time and at a defined price.
This model of working is common in many service sectors such as IT, training, marketing and outsourcing, as well as amongst businesses supplying into original equipment manufacturer (OEM) supply chains.
The company argues that paying employees, suppliers and subcontractors can be a challenge for businesses in these sectors as most rely on payments from their customers to fund overheads.
Any payment delays can cause cashflow problems and potentially limit the business’s ability to take on new contracts or customers.
In response, the firm’s Contract Finance offering aims to provide fast access to working capital against contractual billing, usually within 24 hours.
Andrew Dixon, commercial director – specialist finance at Aldermore, said: “We have launched our Contract Finance offering at a time when a growing number of companies are entering into long-term contracts to outsource their supply chains or services such as IT, marketing and training.
“Our new funding solution gives SMEs an invaluable safety net for any unexpected late payments or project delays and can be customised to meet the specific requirements of individual businesses.”
Among users of the service is Mike Wood, managing director of Telling Architectural, the West Midlands-based developer and distributor of advanced building facades.
He said: “The nature of what we do means that it is common for us to have to wait for payments from our clients.
“Aldermore understands this and their expert team pulled out all the stops to deliver a bespoke funding solution for us based on their new Contract Finance offering in a very short space of time.
“The specialist support from the bank gives us peace of mind that we will always have the capital available to pay our employees and suppliers regardless of whether we experience a delay in receiving payment for the work we do.”
