PRBC scoring methods makes alternative lenders ideal for SMEs

Investment levels are 10 percent below where they were in 2008, according to the Financial Times, and the debate over the causes of the dried-up lending market in the United Kingdom rages on.

Businesses are blaming the lack of available funding, banks claim there isn't much demand and nearly everyone holds the failed Funding for Lending Scheme at least partially responsible.

"For too long, the SME lending market has been dominated by a few big players and businesses are struggling to access finance to grow," said John Walker, chairman of the Federation of Small Businesses, according to The Telegraph. "Competition should come from more banks on the high street as well as alternative providers."

Regardless of the reason, most people agree that the SME sector's success will be crucial for the U.K.'s revival - which is why smaller companies should turn toward alternative short term lending for help.

Alternative lenders typically employ different scoring methods, such as Payment Reporting Builds Credit, to determine which businesses are eligible for funding. These strategies look at a company's ability to pay its utility bills on time, among other factors, as opposed to solely credit scores.

In addition, alternative finances are generally more flexible and, at times, are available literally overnight.