# Fintech is changing the face of Asset Finance-Magazine
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2017-06-13
Category: FINANCE
Category URL: https://financedigest.com/category/finance
Meta Title: The Future of Business: Embracing Financial Technology in
Meta Description: Discover how fintech is revolutionising the banking sector and the challenges and opportunities it presents for businesses in the UK.
URL: https://financedigest.com/fintech-is-changing-the-face-of-asset-finance-magazinehtml

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Rapid advances in financial technology over the past few years have changed the way we do business.

![Dave Chapman](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/dave-chapman-240x300-1736843769738-compressed.jpg)

Dave Chapman

Getting to grips with the disruptive nature of technology has its challenges, but also brings opportunities to those who are brave enough to grab them.

A 2016 Economist Intelligence Unit study, which surveyed more than 200 [senior retail bank executives](https://www.financedigest.com/societe-generale-says-two-senior-executives-to-leave-bank.html "Societe Generale says two senior executives to leave bank"), showed that bankers expect the banking environment to be shaped strongly by technology, and non-traditional competitors, by 2020.

The [report stated that the ‘scale of disruption](https://www.financedigest.com/trapping-and-mating-disruption-systems-market-is-witnessing-high-sales-growth-over-2028-fact-mr-report.html "Trapping And Mating Disruption Systems Market Is Witnessing High Sales Growth Over 2028, Fact.MR Report") is unprecedented, across every market, every distribution channel and every single product line’.

As financial technology (fintech) start-ups threaten to increase their share in the lending sector, traditional banks are fighting back with their own [digital platforms](https://www.financedigest.com/digital-id-revolutionises-end-to-end-mortgage-and-protection-platform.html "Digital ID Revolutionises End-to End Mortgage and Protection Platform") offering quick and easy loan applications.

As a result, fintech is gradually starting to seep further into the [growth strategies](https://www.financedigest.com/industrial-catalytic-converters-market-competitive-growth-strategies-based-on-type-applications-end-user-and-region.html "Industrial Catalytic Converters Market Competitive Growth Strategies Based on Type, Applications, End User and Region") of major banks, lenders and other financial services providers which had previously taken a more traditional approach to the way they did business.

But while the advent of fintech is making it easier for growing [firms to access finance](https://www.financedigest.com/prioritising-employee-wellbeing-in-finance-firms-through-learning-and-development.html "Prioritising employee wellbeing in finance firms through learning and development"), ongoing issues surrounding the availability of finance through the more traditional routes is also causing businesses to look for other ways to fund their investments and growth.

A recent [survey by the British Business Bank](https://www.financedigest.com/two-speed-economy-in-sweden-central-bank-business-survey-shows.html "Two-speed economy in Sweden, central bank business survey shows") found that around 100,000 smaller businesses have formal applications for loans totalling £4bn rejected by lenders each year, even though smaller businesses are an essential part of addressing the UK’s productivity challenge.

And last year, the Treasury said that 324,000 [SMEs sought a loan or overdraft](https://www.financedigest.com/putting-smes-first-the-alternative-to-the-overdraft.html "Putting SMEs first: the alternative to the overdraft"), with 26% initially being declined by their bank. Of those rejected, only three per cent sought alternative options.

Total bank lending to [small business](https://www.financedigest.com/reasons-to-obtain-iso-9001-certification-for-small-businesses-in-australia.html "Reasons To Obtain ISO 9001 Certification For Small Businesses In Australia") has shrunk in most years since the financial crisis.

Around 80% of [small business](https://www.financedigest.com/top-benefits-of-invoice-discounting-for-small-businesses.html "Top Benefits of Invoice Discounting for Small Businesses") loans are provided by the big four banks, while seven out of 10 companies seek finance from only one lender.

Yet the UK’s economy has continued to perform well in comparison to other developed nations, which is borne out in [sentiment among](https://www.financedigest.com/sentiment-among-german-exporters-falls-for-third-month-in-a-row-ifo.html "Sentiment among German exporters falls for third month in a row -Ifo") smaller businesses, most of which have stated they remain confident in their own growth prospects.

However, Brexit and the ongoing turbulence in [global markets](https://www.financedigest.com/n95-masks-market-rapid-expansion-of-the-life-science-industry-is-anticipated-to-drive-the-global-market.html "N95 Masks Market: Rapid Expansion of the Life Science Industry is Anticipated to Drive the Global Market") aside, one of the biggest challenges facing the UK economy is raising productivity, which currently lags levels across the rest of the G7 nations.

Entrepreneurial activity in the UK also remains high, with [strong rates](https://www.financedigest.com/stocks-fall-as-strong-u-s-payrolls-muddies-rate-bets.html "Stocks fall as strong U.S. payrolls muddies rate bets") of new business formation in recent years.

Over 383,000 new business enterprises were registered in 2015, more than at any other [time since](https://www.financedigest.com/sterling-slides-below-1-15-for-first-time-since-2020.html "Sterling slides below .15 for first time since 2020") 2000 (as reported by the Office for National Statistics).

Yet the UK sits near the bottom of OECD tables for the percentage of [start-up businesses which grow](https://www.financedigest.com/building-a-fast-growing-start-up-as-a-female-founder.html "Building a Fast-Growing Start-Up as a Female Founder  ") to more than ten employees within three years.

As SMEs employ most of the UK’s private sector workforce, creating a dynamic small business sector is key to [boosting productivity](https://www.financedigest.com/product-innovations-and-advancements-in-technology-to-boost-automotive-ignition-system-market-growth.html "Product Innovations and Advancements in Technology to Boost Automotive Ignition System Market Growth"), which in turn will convert growth into rising standards of living.

All of this highlights not only the importance of smaller businesses to the UK economy, but also the clear need for the finance [markets to support those growing](https://www.financedigest.com/dental-implants-and-prosthetics-market-market-to-grow-at-robust-cagr-by-2028.html "Dental Implants and Prosthetics Market Market to Grow at Robust CAGR by 2028") businesses.

It’s also clear that, for many businesses, the traditional route to finance through the banks isn’t working and they are having to look at [alternative](https://www.financedigest.com/demystifying-alternative-finance.html "DEMYSTIFYING ALTERNATIVE FINANCE") sources of funding to finance their growth and achieve their business ambitions.

To realise that growth, firms need to be able to invest in the latest plant, machinery and [technologies to keep](https://www.financedigest.com/innovation-based-stability-to-keep-the-ozone-technology-market-going.html "Innovation-Based Stability To Keep The Ozone Technology Market Going") the pace.

Asset [finance is one way](https://www.financedigest.com/6-ways-to-finance-your-dream-vacation.html "6 Ways to Finance Your Dream Vacation") of enabling them to do so.

The [sector has grown year-on-year since the end](https://www.financedigest.com/demand-for-tissue-and-hygiene-market-from-key-end-use-sectors-to-surge-in-the-near-future.html "Demand for Tissue And Hygiene Market from Key End-use Sectors to Surge in the Near Future") of the recession to the point where, in 2016, lenders provided £118bn of new asset finance, £30bn of which was provided to businesses and the public sector.

Last year, lenders financed almost a third of UK investment in machinery, equipment and purchased software.

Until only recently, asset finance was arranged by lenders’ direct sales teams, or specialist brokers with [in-depth knowledge of the industry](https://www.financedigest.com/dry-molasses-products-market-overview-in-depth-analysis-of-market-size-growth-industry-overview-2022-2029-2.html "Dry Molasses Products Market Overview In-depth Analysis of Market Size, Growth, Industry Overview 2022-2029"). But, as the pace of change is moving so fast, customers want to access finance faster and more easily, and online.

Recognising this, Midlands Asset Finance, a leading independent broker, recently launched a new online digital platform, [www.assetfinancecompared.co.uk](http://www.assetfinancecompared.co.uk), which delivers an online quote and a quick credit decision for businesses with an asset finance requirement.

The platform analyses information entered by a customer and undertakes various checks and references to data before issuing the best single ‘decision in principle’ on an automated basis.

Identification is verified through the platform too, so the transaction can be handled quickly and remotely.

While other comparison sites divert the user to the funder to [tie up the deal](https://www.financedigest.com/britains-jd-sports-extends-nike-ties-with-partnership-deal.html "Britain’s JD Sports extends Nike ties with partnership deal") once a quote has been provided, Asset Finance Compared’s in-house team looks after the entire process.

Asset finance remains an essential part of the UK’s investment recovery and it’s crucial that businesses are supported to increase their capacity to invest.

Technology is also evolving at a rapid pace and being able to trade digitally is essential to support [business growth](https://www.financedigest.com/euro-zone-business-growth-slowed-in-may-as-factories-struggled-pmi.html "Euro zone business growth slowed in May as factories struggled-PMI") and investment plans.

So, while fintech is being embraced by traditional banks and lenders, websites like [www.assetfinancecompared.co.uk](http://www.assetfinancecompared.co.uk) are using it to change the face of asset finance as well.

**Dave Chapman is a Director of Midlands Asset Finance. Based in the East Midlands, the firm specialises in arranging asset finance, invoice finance and property transactions for businesses across the UK in all** [industry sectors.](https://www.financedigest.com/expansion-in-manufacturing-sector-has-increased-demand-for-industrial-cooling-system-market.html "Expansion In Manufacturing Sector Has Increased Demand For Industrial Cooling System Market")

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“Original publication in Finance Digest Issue 1 https://www.financedigest.com/finance-digest-print-magazine/”
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