Business department confirms plans to review frequency of rate revaluation

Business department confirms plans to review frequency of rate revaluation

The Department for Business, Innovation & Skills (BIS) has outlined plans to review the way in which properties are revalued for business rates, although no changes will be introduced before the next revaluation, which is scheduled to take place in 2017. The plans were included in an official response to the BIS Select Committee’s Retail Sector Inquiry Report, which recommended that before the next revaluation BIS should work towards “the complete reform of the revaluation system, one of the ambitions of which should be the annual review of Business Rates”. BIS has confirmed it would consider ratepayers’ responses to a discussion paper focusing on the issue, and would look at options for reform “including possible changes to valuation approaches and the frequency of revaluations.”

Read more

Asset-based finance continues to grow

Asset-based finance continues to grow

The supply of asset-based finance has increased by 29%, from £13.6 billion in 2009/10 to £17.5 billion in 2013/14, according to new figures from the Asset Based Finance Association (ABFA). By contrast, bank loans fell by 19% from £485 billion to £391 billion over the same period. ABFA’s figures reveal that 80% of asset-based funding is in the form of invoice finance, with the remaining 20% made up of lending secured against assets such as stock, property and machinery. ABFA Chairman, Martin Morrin, said invoice finance “has truly stepped into the mainstream of business funding.”

Read more

Employee benefit records to be targeted by HMRC

Employee benefit records to be targeted by HMRC

HMRC auditors are to target records for employee benefits such as use of company vans and subsistence allowances when auditing company accounts, according to Paul Tucker, Partner at Smith and Williamson. Speaking at the Chartered Institute for Personnel and Development’s (CIPD’s) Reward Conference, Mr Tucker warned the audience that HMRC are placing renewed emphasis on benefits and rewards classified as ‘taxable benefits’. He described allowances and the use of company vans as “easy targets”.

Read more

New crowdfunding scheme for social enterprise announced

New crowdfunding scheme for social enterprise announced

The Community Development Finance Association and Unity Trust Bank have announced that they are developing a crowdfunding scheme to enable people in local communities to invest money to cover loans already provided to social enterprises by Community Development Finance Institutions. The initiative will help to release CDFI funds so that they can lend to more local social enterprises, many of which struggle to raise finance from traditional high-street lenders.

The scheme is expected to be launched at the end of May 2014 but no figures about how much money could be made available under the new initiative have yet been announced.

Read more

Most smaller firms are not seeking external finance

Most smaller firms are not seeking external finance

There is little evidence of ‘frustrated demand’ for external finance from smaller firms, according to a report by BDRC Continental.

The report revealed that in Q4 2013, 79% of smaller firms were ‘happy non-seekers’ of finance (they had not applied for finance in the previous 12 months and nothing had stopped them), up from 73% in Q4 2012. Just 8% of smaller firms had applied for a new or renewed loan or overdraft facility in the previous 12 months, and the majority were approved. Almost half of respondents expected to grow in the next year and 15% planned to apply for new or renewed finance.

Read more

FCA confirms forthcoming consumer credit rules

FCA confirms forthcoming consumer credit rules

The Financial Conduct Authority (FCA) has confirmed the rules it will apply to consumer credit firms from 1st April 2014, when it takes over consumer credit regulation from the Office of Fair Trading (OFT).

Around 50,000 firms are expected to be affected by the change in regulator, from ‘low-risk’ firms such as those selling goods or services on interest-free credit, to ‘high-risk’ firms such as payday lenders, pawnbrokers and firms selling goods under hire-purchase agreements. While low-risk firms will be eligible to trade with ‘limited permission’, high-risk firms will require ‘full authorisation’ and be subject to robust rules covering their conduct.

Read more

Report criticises failing Funding for Lending scheme

Report criticises failing Funding for Lending scheme

A Public Accounts Committee (PAC) report has criticised the Funding for Lending scheme, concluding that lending by participating banks to smaller firms has fallen by £2.3 billion since the scheme was launched in 2012. According to the report, Government departments have also failed to make firms aware of the funding available.

Margaret Hodge, Chair of the PAC, said that expensive credit cards and overdrafts remained the financing options most frequently used by smaller firms. She recommended that the new British Business Bank, due to open later in 2014, which will have £1 billion of capital available, should manage and co-ordinate a single coherent funding programme for smaller firms.

Read more

Government high-growth support misjudged

Government high-growth support misjudged

Research by Scottish academics has concluded that Government support for high-growth firms is misjudged, due to a lack of understanding about the true nature of such firms. The research, published by the charity Nesta, found that policy-makers believe high-growth firms are typically new high-tech businesses, often university spin-offs, which are funded by venture capital. As a result, support has been focused on R&D grants and public sector venture capital co-investment schemes for technology-based firms, which the researchers claim are often incapable of growth.

The research concludes that current high-growth support programmes are largely ineffective, because most high-growth firms are actually well-established firms in traditional sectors, which rely on bank loans or retained earnings for funding, and need advice and peer support, not cash.

Read more

Plans requiring banks to share data with alternative finance providers announced

Plans requiring banks to share data with alternative finance providers announced

A consultation on proposals to make it easier for alternative finance providers to check the creditworthiness of small firms has been opened by the Treasury. The proposals outline new rules that would require banks to share credit data relating to their small and medium-sized business customers via credit reference agencies. Financial Secretary to the Treasury Sajid Javid said: “Requiring banks to share data is an important part of creating a more level playing field that will enable more providers to enter the market.” The consultation is open until 21st February 2014.

Read more

New Welsh business grant programme opens

New Welsh business grant programme opens

The Welsh Government has announced the launch of a new £1.5 million fund, to help create up to 250 jobs and safeguard many more. Grants of between £5,000 and £25,000 will be available to provide up to 50% of the costs of eligible capital projects. Small and medium-sized businesses in Wales will be able to bid for the SME Small Capital Investment Grant until 20th January 2014.

Economy Minister Edwina Hart said: “Small and medium-sized enterprises are vital to promoting economic growth. I want to ensure that they can access the finance they need to grow and create jobs.”

Read more