Shifting the focus to Scotland

By Darwin Delahaye, commercial partnership manager at Spotcap UK

A few weeks ago, I travelled north of Hadrian’s Wall with a calendar full of appointments with Glasgow and Edinburgh-based brokers. My aim: to find out more about the alternative finance landscape in Scotland, meet local brokers and to gain a greater understanding of the challenges they are facing.

A growing SME market
There are a growing number of small and medium-sized businesses in Scotland, something that Scottish brokers were keen to highlight. There were 365,000 private sector enterprises alone in 2017, a growth of 11,110 (3.1%) on the previous year.

While this may be an encouraging sign, recent findings have shown that the Scottish economy is lagging behind the rest of the UK. Forecasts suggest expected growth of less than 1% a year until 2023.

When considering subdued economic growth alongside a growing number of businesses, the potential for progress is huge. The time for alternative finance to make a difference is now.

Ready to learn
It’s not difficult to find a broker in Scotland but finding an alternative lender can be a challenging task. A positive by-product of this is a strong willingness to learn. Unsecured lending and speedy credit decisions may not be common, but this leads to an even greater enthusiasm to hear about the benefits.

One broker mentioned that it isn’t just clients who need to be educated in alternative finance, but brokers too. I think this is where the greatest results can be achieved: Spotcap team members regularly schedule face-to-face meetings and attend networking events in Scotland. In this way, we don’t just increasingly expand our network in the region, but also contribute to the fact that more and more trusted advisers consider alternative finance a mainstream option.

Geography as a barrier
Scottish brokers are a friendly bunch and this extends to their work. During my meetings, they were keen to hear about our product, but also to get to know me on a more personal level. However, with so many lenders based south of the border, it seems that these conversations often become impersonal.

One broker explained his frustration at being asked to send cases to lenders that they had never met. He wasn’t demanding a Scottish-based lender, but he clearly valued personal relationships in his work. With Edinburgh and Glasgow situated further away from England’s financial hubs, it’s understandable that the cities’ brokers might feel overlooked.

The solution to supporting Scottish SMEs is clear: it is the responsibility of both brokers and lenders to ramp up their networking, partnering and educating efforts. With so much potential, it’s time to put geography to one side. The physical distance between us shouldn’t mean we share a distant relationship.