Published : 8 years ago, on 07/01/2017

By Niels Turfboer, managing director of online lender Spotcap.

The beginning of the year is a great time to evaluate how we run our business and service our clients. It’s a natural time to improve, learn, and raise the bar.

If we are honest with ourselves – sure – most things we set out to change at the beginning of the year remain undone at the end. But New Year’s resolutions are essentially goals, and we all know that goal setting is important to help us grow.

In 2017 UK accounting firms will need to prepare for a string of challenges: new technologies, changing accounting rules and political developments. Faced with these disruptive forces it is a good idea to be armed with a tangible focus and positive perspective.

The Institute of Chartered Accountants in England and Wales (ICAEW), whose membership advises over 1.5m businesses accurately points out that “these aren’t challenges, they’re opportunities, but only if we adapt and innovate.” Furthermore, they also they also give us an indication of where we should focus our energy and efforts in 2017, stating what we all know “basic services are being commoditised.” The central question of course is: What can I do differently this year that will allow me to provide a higher-quality differentiated service?

To tackle this accountants need to take a more customer-centric approach. Clients today want to have an ongoing discussion with their accountant about their business and receive information on the latest tools and resources available. What are financing options available to me? How can I use cloud technology to streamline my payroll? What areas of my businesses should I invest in to grow?

Access to finance is one of the areas that has gone through a lot of change in the past few years. In post-Brexit Britain businesses – in particular SMEs – are aware that change is coming their way. They know they will need to be flexible both when it comes to business strategy and funding needs, but often lack awareness of the options available.

Today there are multiple funding alternatives to traditional bank loans. According to a report by the Cambridge Centre for Alternative Finance the UK online finance sector grew 84 percent in the past year, and now accounts for 12 percent of total business lending.  The main categories to be aware of are:

• Credit Unions: a non-profit institution with several economic deposit funds in a member-owned space. It is lending by entrepreneurs for entrepreneurs, and is comparable to a small bank.
• Government support: there are a few options available to SMEs and entrepreneurs based in the UK. For instance, the UK government Innovative department offers the Smart Grant Scheme with funding available from £25,000 up to £250,000. The UK government also support small businesses with unique programs such as the Seed Enterprise Investment Scheme (SEIS), the e-Business Grant Scheme and the Business Development Scheme Grant for expansion. However, these grants are often sector-specific and typically available on a region-by-region basis.
• Crowdfunding: online crowdfunding platforms are cropping up all over the world. These platforms provide entrepreneurs with the opportunity to connect with thousands of potential investors in the form of loans, shares or even a donation. Crowdfunding is the ultimate test of whether the public believes enough in a product to invest in it. However, these campaigns can take a great deal of preparation and time to execute.
• Unsecured business loans: a loan that isn’t backed up by any asset. Instead it is backed up by a business’s trading position.  The ideal candidate for this type of setup is a company that has a long trading history, provable growth, and a balance sheet.  The loans work well for short term working capital purposes, where funding is required in a matter of days. Today there are an increasing number of players offering unsecured business loans online in various formats e.g. a free credit line that only gets activated once a drawdown is made.

Thoughtful information sharing on financing options, such as the ones mentioned above, new technologies or regulation are all opportunities for accountants to show that they have adopted a customer-centric and value-added mind-set.

Outside the UK, European accountants are finding that this approach is helping strengthen existing relationships as well as win new clients.

JeroenHollewijn, senior adviser 216 accountants, a spin-off of KPMG Netherlands, said “We met Spotcap on the local fintech scene and recognised that it could be a win-win relationship. By being able to offer both our advice and alternative finance solutions we have been able to differentiate ourselves from our competitors and improve the relationships with our clients. Banks have long dominated the financial market and we think that the new alternative finance providers on the market can make a big difference for our clients’ businesses.”

In closing, accountants can add a huge amount of value. Unfortunately, as we well know, the reality is that is all too easy to be buried under a mountain of everyday processes and compliance issues. As aWanda result, finding ways to add value in a strategic sense gets pushed to the side. In 2017 make a change. Set aside time to brainstorm ideas what the client can do to grow their business. Be the trusted adviser your client needs. Not only will the relationship thrive, I would be so bold as to bet that you will find the shift fulfilling as well.

Are you up for the challenge?