Commenting on the Government’s recent decision to end the ban on assignment contracts, outlined in the response to ‘Nullification of Bank on Invoice Assignment Clauses’, Carl D’Ammassa, Group Managing Director - Business Finance at Aldermore, said:
“The Government’s plans to nullify the ban on assignment contracts will help smaller firms release the value of unpaid invoices.
“Bans on assignment contracts are sometimes put in place by large corporations to prevent smaller businesses from selling their invoices to third parties. This can suffocate fast-growing smaller businesses, many of whom don’t want to turn down big contracts but can’t afford to have capital tied-up when those large businesses don’t pay on time.
“A new survey from Aldermore this month found that 15% of key decision makers in small and medium-sized enterprises are kept awake at night worrying about late payments. Ending the ban on assignment contracts will mean that all SMEs will at least have the option of using invoice finance to freeup cashflow and prevent late payments becoming an issue.
“At a time when access to finance is high on the list of priorities of UK SMEs, having one more financing option available for all is an extremely welcome move.”
Click here for an image of Carl D'ammassa.
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