Debt Finance

Raising money for working capital or capital expenditure

Debt can come in many different forms but is commonly available for working capital facilities such as overdrafts supporting day to day liquidity requirements, or for longer term finance supporting investment, acquisition and capital expenditure. Unlike equity, debt does not involved relinquishing ownership in the business. Throughout its life, a business is likely to need a mix of different forms of debt depending on its stage of development. All have their advantages and disadvantages. In Jersey, debt finance can be sought from a bank or non-bank finance provider.

Overdrafts and Bank Loans

Local high street banks may provide funding to businesses based on their evaluation of the application. Banks will usually require a business and financial plan to support any application for finance and these will need to show that the business is capable of generating the income and cash to repay the loan. The advantages of approaching a bank include:

  • Small business focus makes this a flexible option for established small businesses and start-ups.
  • Building on an established relationship you may already have with your bank through your personal banking.
  • Competitive rates – banks typically offer more competitive borrowing rates than non-bank providers
Asset and Commercial Lending

Asset finance provides a range of products which can help fund the new equipment, stock, professional fees or vehicles and machinery a business needs. This forms of financing can be crucial for a business because the loans are secured of the asset being financed, making it flexible and secure.

  • Local and independent providers who deal with applications in-house by a team of lending experts, all with local knowledge and often with industry specific experience.
  • Spreading the cost allows you to transform the cost into affordable, fixed monthly payments.
  • Flexible repayment options allow you to work with your cash flow.

Other useful sources of information.

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