Opinion

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Since the financial crisis back in 2008 bank finance has been a difficult thing to come by for a lot of small and medium businesses.

In response to this we've seen the emergence of a diverse number of business funding options which are aiming to shake up the interest.

Nesta estimates that alternative finance in the UK grew by 91 per cent in 2013 and is expected to be worth £1.6bn in 2014.

Of these, crowdfunding is perhaps the option which has made the most headlines, offering small investors the chance to support a business whether for equity or more material rewards.

P2P lending has also been popular, with platforms like Zopa and Funding Circle helping businesses borrow from multiple small lenders rather than going cap-in-hand to the bank.

Pension-led funding is another option, allowing business owners to tap into their pension pot to fund their business. 

The economy has place a particular squeeze on cashflow with more and more reports emerging of the struggle small businesses face with late payments. Invoice discounting and factoring have been around for a while but new platforms like MarketInvoice and Platform Black offer businesses the chance to flog their unpaid invoices to the highest bidder. 

Technology has played a big part in changing the face of funding. Computerised lending decisions have attracted concern in the consumer payday loan sector but short-term lenders like Everline and Ezbob are using these algorithms to reduce the delay in lending decisions to a fraction of those you can expect from the bank. 

So where do all these innovations leave the banks? Despite everything they remain very much the dominant lender and as the economy improves we could perhaps expect this situation to only increase.

But many alternative finance providers are adamant they represent a genuine shift in the future of business funding.

Throughout May we’ll be examining this industry with profiles and case studies of the solutions on offer and features examining what we can expect from the future.

More from this focus:

Banks should refer rejected businesses to alternatives

Alternative funder profile: Liberis

Ezbob: Using tech to outflank the banks

MarketInvoice: Turning what you're owed into working capital

Five ways to compare funding for your business

Seven ways to get funded when bootstrapping isn't an option

"Crowdfunding isn't just for startups"

Why we went for impact investment

Tap into your pension pot to fund business growth

The future of funding is full of opportunities

Metro Bank targets small businesses

Four ways to launch a successful crowdfunding campaign

Number of UK crowdfunding platforms grows by 50%

How speedy is bank funding?

Four predictions about the future of funding

P2P lending grows by 50% in five months

Next: UK manufacturing hotspots to benefit from extra funding and tax breaks

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