Our Market

Small and medium-sized enterprises (SMEs) are crucial to the global economy. On aggregate they are much bigger employers and job creators than larger companies. They are also traditionally flexible and responsive to change, therefore driving innovation and competition.

SMEs often, however, operate at a disadvantage. Theydon’t have the clout of large companies, and they generally find it more challenging to access external financing. This also tend to extend to their relationships with other stakeholders. They have less negotiating power with suppliers and customers, and they will find it more challenging to endure periods of crisis.

A key solution to enable SMEs to stay competitive and continue playing their important role in the global economy is ALTERNATIVE FINANCING

Imperium is a lender to Alternative Finance lenders. We pride ourselves on playing a crucial role in the growth of the SME sector.

There are many forms of Alternative Financing. We deal with companies that provide:

  • Invoice Factoring;
  • Supply Chain Funding; and
  • Merchant Cash Advance

Imperium acts as a facilitator of transactions to allow South African investors/lenders to lend into this environment. This gives them global exposure to a fast-growing, asset-backed industry while we take care of all the daily management.

GROWTH IN ALTERNATIVE FINANCE

Alternative lending has grown a great deal in economies like the US and UK where firms have started early. At this moment, this segment shows massive growth potential. It is because there is a shortage of cash supply, and this industry can address that.

Even though traditional banks still hold the largest market share for business lending, growth has continued to slow – suggesting an increased demand for alternative lending platforms.

According to the “Alternative Lending State of the Market Annual Report”, the most comprehensive overview of the alternative lending landscape, the industry is clearly showing no signs of slowing down.

The report noted that the UK’s flourishing alternative lending market isnow worth a record £6.26bn. The wider European market has also seen significant growth where the market size has doubled during 2020 to a total value of €6.6bn.

According to data reported by SME Finance Forum, in 2018 there was funding gap of $5 trillion between the financing needs of SMEs and the institution-based financing available to them — causing SMEs to seek alternative funding options.

Benefits to Lenders/Investors

  • Private credit exposure to business loans that historically were the province of traditional banks
  • Non-market correlated yield and relatively low duration
  • Diversification to other types of fixed income

What is Invoice Factoring?

Invoice factoring is sometimes referred to as ‘factoring’, or ‘debt factoring’. It is a financial product that enables businesses to sell unpaid invoices (accounts receivable) to a third-party factoring company (a factor).

Invoice factoring companies buy the invoices for a percentage of their total value and then takes responsibility for collecting the invoice payments.

Factoring is an increasingly popular form of alternative business funding. This type of alternative finance has grown in popularity over the last few years.

What is Supply Chain Finance?

Supply chain finance, also known as supplier finance or reverse factoring, is a set of solutions that optimizes cash flow by allowing businesses to lengthen their payment terms to their suppliers while providing the option for their large and SME suppliers to get paid early.

Supply chain finance (SCF) is an arrangement between the buyer, the supplier and a financier (or factor) by which the payment for the receivables by the supplier is received in advance, thereby benefiting both the buyer and the supplier.

What is Merchant Cash Advance?

A merchant cash advance is a business cash advance against your future revenue. You get a lump sum of capital upfront, which you then pay back with a percentage of your daily credit card sales. A merchant cash advance is designed for businesses that have short-term financing needs and require funds fast.