Financing solutions: alternatives to bank lending

How to improve liquidity without recurring to bank credit

More than ten years have passed since 2008, but the credit crunch of the banking system does not seem to diminish. In particular towards SMEs, many of which, despite having good profits and profitability, suffer from a lack of liquidity that jeopardizes their growth.

Let's then see some alternative financing solutions to bank lending to which companies can resort to obtain liquidity.

Factoring and invoice trading

According to a research of the Atradius group, collecting invoices in Italy takes in average 74 days. To avoid a lack in liquidity, companies can resort to factoring. Through a factoring transaction, the company can sell its accounts receivable to an intermediary agent (factor) to improve its working capital. The operations costs for the company include only the costs and the interest rates applied by the factor.

With invoice trading invoices are sold through web platforms to investors and the company immediately receives a deposit equal to 90% of the nominal value of the invoice. When the debt is paid, the investor collects the amount and pays the balance to the seller. In this case, the costs for the company include the commission charged by the platform and by the investor.


Minibonds have been introduced in Italy in 2014 by the Decree-Law Sviluppo, which enabled SME to issue debt securities under € 500 million. Like any kind of financial obligation, minibond grant investors an interest rate, paid through fixed of floating-rate coupons. The principal can be refunded at the maturity or amortized over the life of the bond.

The issuance of minibonds brings several advantages. Through this channel, companies can increase liquidity and improve their economic and financial position, diversify the financing sources, and reduce dependence on bank credit.

To further reduce issuance costs, companies can also apply for a basket bond operation. A basket bond is a portfolio that collects the minibonds of a group of companies, in order to represent an asset of some interest to investors. In this way, companies can reduce the issuance’s denomination, share part of the costs with the other participants and benefit from any guarantees on the entire portfolio.


Crowdfunding is the most widely employed financing channel for the launch of a company or a new product.

Through crowdfunding platforms companies can search for backers interested in financing their project or new product. There are different models of crowdfunding, according to the reward offered in exchange for financing, which ranges from royalties-sharing to outright non-repayable donations, where no reward is offered. Reward-based crowdfunding is quite common and reward backers with a sample of the product or service the company wants to launch.

A particular crowdfunding formula is equity crowdfunding. Equity crowdfunding (or crowdinvesting) allows people to invest in private companies and receive shares in equity capital in return for the capital raised. Invoice-trading as well is considered a crowdinvesting formula.

It is worth recalling that, whether the most suitable solution adopted, any form of financing presents a risk for investors.

A stable economic and financial situation may reassure of the company's ability to repay them, and of the investment opportunity. Thanks to s-peek, you can check your business' reliability and monitor your company's health.

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