Finance with a personal touch retains importance in digital age

UK businesses prioritise strong personal relationships and sector expertise when choosing equipment finance providers, just as much as they value competitive rates, according to industry executives.

Companies have revealed that straightforward application processes and direct links to someone who understands their business remain vitally important, despite the increasing use of technology in lending.

This is particularly the case for small to medium-sized enterprises (SMEs), who need expert guidance about making long-term financial commitments.

This means that lenders could gain a competitive edge by maintaining a human touch, while at the same time using digitalisation to simplify the lending process and accelerate decision-making.

Last year, it received a £9 million funding line from Bibby Financial Services (BFS) to grow its operations, through a mixture of invoice finance, trade finance and foreign exchange facilities.

Paul Fraser, director of specialist finance at Bibby Financial Services, said: “SBZ was initially only looking for additional buying power, but by discussing the business’s needs and developing a keen understanding of its ambitions, we were able to put together a suite of products to help it realise its growth.”

However, this commitment to traditional values of customer service does not mean there is no room for innovation or embracing digitalisation.

Digital services can minimise the resources tied up in low value or time-consuming tasks, so instead employees can provide customers valuable in-depth advice, information and support where it is needed most.

For example, innovations can include chatbots, which filter out straight-forward enquiries to be handled digitally, so customer service employees can focus on more complex tasks and relationship building.

Close engagement with potential customers can also enhance services that are designed to support this streamlined approach, so that digitalisation adds value.

For example, last year specialist finance sales technology business Codeweavers researched the views and experiences of consumers in coffee shops across the UK while developing its next-generation technology for car finance and e-retailing.

The company’s User Experience (UX) team conducted a series of short sessions with consumers on their car buying and financing views.

The coffee shop initiative reflects the company’s agile way of working, it says, and was developed because of the way the UK has embraced café culture over the past 20 years.

It gained candid and useful insights about car buying motivators, tools and processes that customers would value and those which they find frustrating.

A “significant gap” emerged between industry and users’ expectations, it said.

Sales director Shaun Harris said: “This is a great exercise for all of us. It is so easy to be locked into your own role and business and overlook the challenges and experiences people face every day.

“We need to keep our thinking grounded in a way that will add extra value to dealers and consumers.”

Combining the human factor with the benefits of digitalisation is part of the inspiration for a new funding platform from the Federation of Small Businesses (FSB).

SMEs can use the platform to quickly scour the funding options available and sort potential suppliers by region, with initial offers secured online.

Despite the progress made with the platform, the FSB says direct communication remains important and it advocates the importance of good customer service.

What the rise in digital services will do particularly well is raise awareness of asset finance options alongside more traditional products favoured by SMEs, such as overdrafts, loans or even the use of personal funds.

This in turn may encourage companies to begin a business relationship with a supplier based on a greater understanding of how asset finance can support their needs.

The FLA revealed recently that demand for asset finance grew 5% year-on-year during 2017 as more businesses recognised its potential role in enabling growth.

For suppliers that encourage long-term partnerships with their customers, this growth is certain to continue.