In the wake of technological advancements and economic uncertainty more borrowers are looking for alternative financing solutions. Rather than relying on traditional banks which are often associated with cumbersome and time consuming processes, alternative financing is on the rise.

Encompassing everything from peer to peer platforms to non-bank financial institutions, alternative lending solutions are inherently flexible, innovative and therefore, highly competitive.

At Briqwise, we offer an alternative lending platform where entrepreneurs can realise their dreams and investors can access attractive returns at low risk. By placing an emphasis on seamless service, we can help you navigate alternative lending in a way that is personalised and transparent while also offering transactions characterised by a speed of service not seen in traditional banking.

Understanding the shift away from banks

When applying for a loan through a traditional lending institution such as a bank, the processes are thorough in order to ensure that the bank is making a sound decision rather than what may be deemed as a risky one.

As part of their lending criteria, banks require numerous forms of identification and paperwork that highlights everything from past to current financial information. This information is then processed in-house where this strict lending criteria might rule out candidates from receiving a loan.

Economic factors are also playing a role in borrowers shifting away from traditional banks. Take interest rates as an example. When interest rates are high, loans from traditional lenders become harder and more expensive to secure.

Combine this with the fact that high interest rates often occur in tandem with inflation whereby the price of everything from commodities to raw materials and labour increases drastically. This means that, in light of the surrounding economic environment it is harder for businesses to make a profit.

These factors typically work against those looking to borrow as traditional lenders such as banks might deem that the business owner may not have the financial capacity to furnish the loan.

As a traditional lender looks to determine the feasibility of a loan, days and often weeks pass as paperwork is processed and information is verified. These slow approval times work against those looking for personal or business loans.

Take a business loan as an example. A loan might be sought because a new owner has taken over the business and the previous owner wants to sell the premises. The new owner might want to take out a loan to buy the premises. However, in the wake of slow approval times, the premises might be sold to the next highest offer to get the deal done in a timely manner.

Key Benefits of Alternative Financing for Borrowers

There is great appeal to alternative financing, particularly for borrowers. Characterised by fast approval times, competitive interest rates and greater accessibility, alternative financing lays a platform for empowering lending solutions.

One of the best features of alternative lending is the ability to facilitate a faster application process. As alternative lenders often utilise digital platforms, there is a sense of ease when it comes to filling out forms and uploading documents.

From there, alternative lenders place emphasis on quick return times, meaning that answers will be provided within a one to two day window of time. Disbursement of the funds is just as efficient and effective. This is crucial when you consider that financial needs and business opportunities often need to be resolved or explored as quickly as possible.

Alternative financing is also more accessible than traditional lending. This is largely because these alternative lending solutions are available to those who may not meet the more stringent requirements of banks. Additionally, alternative lending places less of a reliance on collateral such as land or personal guarantees.

It’s also important to note that alternative lending solutions are inherently flexible. With more flexible underwriting criteria comes greater ability to find a repayment structure and lending solution that applies to the individual and their unique business requirements.

Opportunities for Brokers

The rise of alternative lending solutions is providing brokers with an opportunity to build long-term relationships with borrowers. The foundation for these partnerships is laid by the ability of alternative lending solutions to provide individuals with options.

Rather than turning clients away or offering limited solutions, brokers in this new age of alternative lending have a suite of options they can deploy. Each of which is crafted based on the distinct requirements of individual borrowers who may otherwise be disenfranchised with traditional and inflexible lending solutions.

The ability to offer tailored solutions, underscored by a quick and transparent approval process infuses the loan process with a level of transparency and efficiency. Affording brokers with the opportunity to provide a service which is in direct contrast to traditional banking processes.

The Future of Alternative Financing in the Real Estate Market

As more companies and individuals continue to deal with the ramifications of high interest rates, inflation and the possibility of a recession, alternative financing will continue its rate of growth. The reason behind this is twofold.

Firstly, in light of economic conditions and the associated uncertainty, banks will continue their cautious approach to loan applications. This will see the approval of low risk candidates who have a higher likelihood of meeting the repayment schedule, thus creating a gap in the market for alternative lending to occupy.

Secondly, the model of alternative financing which centres around providing accessible, flexible and efficient services to customers both new and existing will become more attractive to borrowers looking to finance real estate purchases which are by their very nature urgent.

As the real estate market reacts sensitively to economic changes such as interest rate rises, the number of properties on the market may increase for the foreseeable future. This means that there will be increased opportunities for those looking to invest or buy a property for their business.

Alternative lenders like Briqwise can help to convert these real estate opportunities into reality. Briqwise works with investors and small-to-medium enterprises to realise ambitions. Fast, flexible and hassle-free, Briqwise prioritises efficiency and transparency.

Why Brokers Should Embrace Alternative Financing

Increasingly disenfranchised with traditional financial institutions’ cumbersome approach to lending, borrowers are turning to alternative lending solutions. Flexible, accessible and timely, alternative financing is proving to be the new way forward.

To stay competitive, brokers need to embrace alternative financing. Not only do brokers benefit from utilising efficient and effective systems, but the borrowing experience is improved. All of which helps to promote better client relations in both the short and long term.

For brokers looking to seize new opportunities in the alternative financing space, explore Briqwise today.

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