Bibby opens €45m invoice financing fund with State lender
The Strategic Banking Corporation of Ireland (SBCI) and Bibby Financial Services Ireland (BFSI) have launched a new €45m invoice financing fund for small and medium enterprises (SMEs).
The fund provides more favourable rates for BFSI's invoice finance facilities accessible for Irish firms and is available immediately.
Invoice financing frees up cash for companies by giving them up-front payment against the value of outstanding invoices.
The deal marks the SBCI's first venture into invoice financing. The State-controlled banking corporation was set up in 2014 to provide lower-cost long-term funding to smaller businesses.
Finance minister Michael Noonan welcomed the new fund.
"This new €45m package further diversifies the funding available to SMEs at a critical time for Irish businesses, especially those who include exports to the UK as part of their sales.
"It is a welcome fact that BFS is a global business with a strong presence throughout the UK and Ireland.
"Irish SMEs are now in a position to benefit from SBCI funding available through an expert Invoice Finance provider," Mr Noonan said.
Bibby deals with over 9,500 customers annually and had a turnover of £9.3bn (€11.1bn) last year. The finance firm employs 30 staff in Ireland at its base in Sandyford, Dublin.
Invoice financing allows companies to grow at the same rate as their sales.
As part of the fund companies will also be offered protection against bad debts should customers become insolvent.
BFS chief executive Steve Box said he was "delighted" to announce the partnership.
"At a time where there is some uncertainty in markets across Europe, the most basic support that SMEs need to grow and scale-up their businesses is access to finance.
"Our €45m facility agreed with SBCI will enable us to deliver lower cost, more flexible and competitive funding solutions to SMEs throughout Ireland.
"While there is still a high level of dependency on traditional banks amongst SMEs, we are seeing a growing appetite for alternative sources of finance and we look forward to helping Irish businesses to thrive and grow, both domestically and internationally," Mr Box said.
In order to avail of the lower SBCI rates the minimum facility period firms must sign up for is two years.
The fund can also issue loans up to a maximum of €5m.
SBCI chief executive Nick Ashmore said the new fund broadens the finance options available to Irish SMEs.
"This facility will considerably strengthen BFSI's ability to serve the Irish market and provide a more competitive product. We are particularly excited to be working with BFSI, given the important support invoice finance offers businesses looking to grow."
Last year 26pc of the SBCI's funding went into the agri sector with just 3pc going into construction services.
Two-thirds of its €172m worth of lending went into five sectors - hotels and restaurants, agri, health retail and other business services.