CRIF teams up with Penny to offer invoice financing service for SMEs

Invoice finance provider Penny has partnered with CRIF, the leading provider of consumer and business credit information in continental Europe, to help UK small and medium-sized businesses (SMEs) get their invoices paid instantly, better manage their cashflow and improve their overall creditworthiness.

The partnership between CRIF and Penny comes as more businesses across the country face challenges due to the uncertain economic climate, with nearly one in three businesses stating they experienced an increase in the late payment of invoices in the last three months of 2021.

Sara Costantini, Regional Director for the UK & Ireland at CRIF, said: “Many [UK businesses] have struggled during the challenging economic climate in recent years.

“Compounding this is the fact that some businesses are denied access to financial support when lenders are unable to build a clear, accurate picture of their finances – particularly if they haven’t been trading long.”

Penny’s invoice financing solution works by allowing a business to advance money against the amount due from their invoiced customers. The invoiced customer then pays Penny directly with terms typically over 30, 60 or 90 days. However, if a true picture of a small businesses’ financial situation is unavailable, this can lead to them being declined.

The new service, which will become available to customers from June, utilises CRIF’s Credit Passport®. It uses Open Banking data to provide a real-time, secure way of speeding up the decisioning process for lenders and providing transparency and advice for SMEs on their creditworthiness.

Colin Gunnell, CEO of Penny, said: “There is a huge portion of the SME market that is not able to access business finance products due to the inability of conventional funders to make real time decisions.

“Penny and CRIF have both individually identified this as a universal problem in the UK which needs to be resolved, building sophisticated platforms to breach the funding disadvantage experienced by SMEs.”

Penny customers will be able to connect their business bank accounts, allowing an instant soft credit assessment via Open Banking. This approach gives a fuller, more accurate picture of a business’s finances than traditional types of credit scoring and reduces fraudulent applications by establishing a historical relationship with the invoice subject.

With data refreshed daily, businesses that may have previously been rejected due to a lack of credit information can now get their invoices paid instantly, with the decision process cut to less than 30 seconds and funds released within 24 hours. This innovation is expected to lead to more business applicants being accepted for loans through Penny.