Resilient SME Finance Option Celebrates 30 Years of Innovation

2,500 clients – £300mn funding

Pension-led funding, developed by the pension specialists at Clifton Asset Management plc, celebrates 30 years since launching to business owners throughout the UK.

PLF has provided £300,000,000 of funding to SMEs in every sector of the economy during this time.
Clifton chairman, Adam Tavener, recently commented “what’s really interesting is the enduring resiliency of PLF. When we developed PLF as a commercial approach to business finance and pensions, we did not foresee events such as the financial crash or pandemic. No one could. But while other forms of finance, banks and other lenders have seen their businesses buffeted by the changing circumstance, PLF continues to be a viable option for business owners”.

Based just outside Bristol, the PLF teamwork with businesses throughout the UK.

“The investment we made over the years in robust systems mean we really didn’t break stride,” says Neil Greenaway, Group Managing Director. “Our advisers and support teams communicate daily with clients and providers. It has been eye-opening to see the way we moved from off to online in a matter of hours.”
Pension-led funding uses the wrapper of the pension, usually a Small Self-Administered Scheme (SSAS) or Self-Invested Personal Pension (SIPP) to facilitate the pension becoming a silent partner with the business. This can then interact with the business through loans, purchasing assets such as commercial property and much more.

A PLF deal is always a ‘pension-first’ proposition, with the emphasis on appropriateness and security.
Clifton research has shown that fewer than 20% of business owners are aware that this innovative form of finance is available to them, and Clifton is preparing to launch a major campaign of awareness over the next 6 months to alert business owners who may be feeling significant stress at present, that they may well have alternatives that will work for them.

Clifton Group Business Development Director, Anthony Carty, noted “business owners have never been under the pressure they feel right now. They feel that all their hard work could be jeopardised by circumstances beyond their control. We are here to say that they can keep control over their business and their finances and should at least explore if PLF might be right for them.”

Pension-led funding is a product developed by the innovation team at Clifton Asset Management Plc and other innovations can be seen at

New – Coming 1st Quarter 2015 – Myviewpointportal

The Financial Services industry has a mixed history when it comes to embracing technology; more specifically, providing a satisfactory user experience of adopted technologies.

Electronic stock exchanges and online banking have been in existence for many years now, but only in the last few have they really come to terms with the user experience. Providers have often failed to understand that, as users, we really just want to use something that is quick, easy and trustworthy.

For smaller entities (IFAs, brokers and the like) the dream of offering truly comprehensive client-friendly, online experiences have been a dream, thwarted in large part by the twin obstacles of high (or unknown) cost and a lack of suitable user technical expertise.

For the last 8 years at Clifton and Morgan-Lloyd we have been building out our digital capabilities, leading to the summer 2014 release of Viewpoint, our 24/7 valuation product.

While online valuations of some investments have been available for a while, Viewpoint allows us to provide instant valuations for our complex SSAS and SIPP transactional schemes. As I write, we believe this is unavailable anywhere else and gives our customers a comprehensive view into their Pension-Led Funding schemes at the touch of a button.

But this is just the start of a significant project to allow our customers full insight to their Clifton and Morgan-Lloyd journey – Myviewpointportal

Myviewpointportal goes much further by offering an innovative, multi-track pathway overview through all transactions, allowing customers to ‘see what’s happened and what’s next’ in their processes. There are also options to upload and download materials, an easy 24/7 ‘Ask a Question’ option and all this as well as always-on access to their investments and pension portfolio.

While maintaining a tight control over customer data, we also want to respond to common issues by offering easier ways for customers to input data into our system so that they can do this when they want to and are not shackled to working hours.

I am excited to reveal that the first iteration of Myviewpointportal will be released in the first Quarter of 2015. Further innovations will be rolled out as the year progresses.

Pensions Freedom

Governments of differing stripes have, over the last 30 years, tried to simplify the path to an adequate retirement, and there is almost universally held agreement that in each case the changes implemented have simply served to complicate matters further.

Now we are faced (on April 6th 2015) with the Granddaddy of all changes. Happily titled ‘Pensions Freedom’ it offers us another glimpse into a simple and clear future as we prepare to bow out from the rat race.

Of course, in reality we are finding that these changes are neither simple nor clear. Faced with a public that will, for the first time in living memory, be given full access to their pension pots, we are gradually awakening to all manner of nightmarish possibilities – not least of which may be the overwhelming desire of some to get hold of whatever cash might be available and use it for whatever hare-brained reason they might currently be considering. This rather than using said funds as a replacement income in their retirement.

Yes, I know. We are adults and should be trusted to behave as such. It is our money and we should be free to spend it as we wish.

Of course. I can’t disagree.

However, in the constant search for civilising and responsible behaviours we do also acknowledge that our actions should sometimes be ‘restricted’ to protect both others and ourselves in our society.

Traffic lights might be a good case in point.

Using the ‘we are adults’ line of thinking we might agree that we should all be able to navigate a simple junction. However, we also know that there is always someone out there who will not be concentrating, or is in a hurry, or some other reason that will not stop them from slamming into the side of our vehicle. The traffic light doesn’t remove the risk entirely, but it most certainly reduces it dramatically.

I’ll come clean. This pensions freedom legislation is good policy. It will open up creative possibilities to many and the scrapping of the pensions death tax sees the end of a bad tax for the right reasons.

But where are the traffic lights?

Good quality advice has been promised to all and yet the government proposes that this advice will be dispensed by the Citizens Advice Bureau and the Pensions Advisory Service.

Anyone involved in the Pensions business (and we are heavily involved in this area) knows that our advice is given by highly qualified individuals with access to the most current thinking and sophisticated tools available. They understand what a minefield this topic is and spend a considerable amount of time and effort in making sure that our clients get extremely detailed and appropriate advice.

For this there is a cost.

I do not believe for one minute that the good people of either Citizens Advice or the Pensions Advisory Service will be able to provide even a tiny fraction of the required pensions advice needed and this is not only a shame, but gives us the real glimpse into the future of what the story of pensions freedom will actually be.

Funding rising

It is very welcome to be able to share a bit of good news on the SME funding front for a change!

The National Association of Commercial Finance Brokers (NACFB) reported last month that SME lending had posted strong month-on-month growth in September, with a total of £1.25bn being lent to small firms. This represents a solid 55% growth from the year before.

This is a healthy development for sure and welcomed by all.

However, many of the underlying problems remain. As the NACFB point out in their research, there are still a full 50% of business loan applicants being rejected for bank support. The research also indicates that a significant majority of those refused funding do not go on and apply elsewhere.

As noted in my previous blogs, this is in effect a drag on growth. Lost potential.

The NACFB continues to promote alternative funding options and, given the success of their latest initiative – Love Lending Week #lovelending – there is a real appetite from business owners to learn more about their options, either before or after their visit to the bank.

While the wheels of government turn slowly, I am happy to report that our initiative in this area, the portal continues to gather pace and I hope that I will have more exciting news on this soon.

Understanding Alternative Finance

Tuesday November 10th saw the long awaited publication of the Nesta/University of Cambridge report Understanding Alternative Finance.

This is a detailed and hugely interesting piece of work and not just to those of us who occupy the world of AltFi. The detailed analysis of several differing forms of Alternative Finance gives the business owner an important, comparative resource for the first time.

Bryan Zhang (University of Cambridge researcher) and his team should be complimented on taking an enormous amount of data and providing us with a snapshot of this fast growing sector of finance, giving us a glimpse of its effectiveness from both the lender’s and borrower’s perspective.

For Clifton as a business it is also hugely important for another reason.

Pension-led funding, the business funding methodology that we have developed and continue to innovate is, for the first time, placed alongside others in the alternative funding space to allow for direct comparison. The result, I am pleased to report, is that we can be extremely proud of the outstanding feedback we have received from our clients.

81% of survey respondents said that they would be ‘likely’ or ‘very likely’ to recommend PLF to a business they know. 79% also said that they are ‘likely’ or ‘very likely’ to approach PLF for funds in the future.

Over 2/3rds of our customers responding said that they would use PLF again, even if their bank offered them funds on similar terms.

These are statistics that count. These are the thoughts of our customers.

Over the next few weeks we will digest this report further and use the findings to help ourselves understand the changing landscape. We need to adapt, just like the large banks need to adapt. A greater acceptance of alternative funding by business owners is great.

More business for all.

But at the same time more funding offerings are springing up making the landscape much more competitive.

In this increasingly crowded market place our biggest challenge is to make sure that SME owners know that they have a choice, and that one of the choices they have is PLF.

More on this to follow.