Attvest solving cash flow conundrums for brokers and their clients

IN Partnership with

The premium funder is quietly revolutionising the management of overdue debts and access to stopgap loans for businesses – improving the health of balance sheets and setting brokers up for future success in a tightening economy

IF THERE was a product that helped bring in monies owed faster and optimised the management of accounts to be more efficient and customer-friendly – and one that made even more sense in a tougher economy – it might sound too good to be true. But Attvest Finance’s Debtor Management (debtMAN) product does exactly that. It is serendipitously designed for the times – when both brokers and businesses with concerns about how to pay their bills can be the ones who stand to benefit the most. “Demand is coming out of market pressure around increasing premiums, cost of living increases, and businesses having to be more cautious of their cash flow,” says chief commercial officer Nick Cunningham.

Attvest Finance is the fourth-largest insurance funder in Australia and has provided over $1.2bn in funding this year. With a network of 600+ brokers and authorised representatives, Attvest has helped clients improve their working capital and cash flow since its founding in 2014. The company's focus is on premium funding, and it recently launched its ATTassist debt collection, ATTpay payments and BiiGGA merchant cash advance services.

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ATTassist debtor management process

Broker generates aged debtor report and uploads via the broker portal on a regular basis

“The service is not based on the sole purpose of converting to premium funding – the sole purpose is to help the brokers manage their outstanding debtors”

Nick Cunningham, Attvest

Attvest set up its stable of ATTassist products around 18 months ago, and debtMAN is rapidly becoming the flagship. The premium funder realised that brokers were not handling their debtor management as well as they could, and, as an expert in the area, saw that it could do better, while also allowing its broker partners to get back to their main business of broking. “[Brokers were] moving away from broking activities into activities such as collecting or chasing up invoices,” Cunningham says. “As we headed into a tough economic environment [with] cost of funds heading up and also premiums increasing significantly on the back of a hardening market, chasing clients to pay the invoices ... was taking their resources.” So Attvest sent in the debtMAN. Specialists in the debtMAN team not only follow up with clients in a systematic way but also explain the different options available under premium funding that might ease the payment burden on the customer. “When you can give the client further [payment] options to what the broker had provided, then the chance of the client taking on the [premium funding] product is much higher,” Cunningham says. In some cases, Attvest saw a 20–30% increase in clients taking up the product.

Sure, more customers signing on for premium funding sounds like a good deal for a premium funder. But Cunningham says the main benefit actually accrues to the broker, because they end up getting paid more of the debts owed to them than they would otherwise – including receiving full payment. “We’ve had more cases of where the client has paid … in full than where they’re taking a loan out,” he says. “That’s really important to us because the service is not based on the sole purpose of converting to premium funding – the sole purpose is to help the brokers manage their outstanding debtors.”

Another standout product that’s proving even more popular in the tougher economy is Attvest’s partnership with BiiGGA, which provides unsecured working capital through a merchant cash advance facility. The funding is short-term, offering amounts from $10,000 to $150,000. One of the key features of the product is the variable repayment structure, which is linked to a business’s turnover and is ideal for seasonal businesses. BiiGGA does not prescribe what do with the funding – whether it should be used for general working capital, marketing or stock purchases. The decision is with the business owner. “Where it’s most beneficial is where there’s a regular flow of income,” Cunningham says, citing the hospitality; health and beauty; and auto industries. One of the main differences between BiiGGA and other alternative lenders is the variable repayments it allows – that is, a fixed percentage of turnover rather than a fixed dollar amount. “What we’re saying is, if you’re an SME, you should have access to working capital.”

BiiGGA chief executive and co-founder Jaco Gunter points to the Australian Banking Association’s recent SME Lending Report, which shows that over 50% of SME demand for additional finance is attributable to the need for working capital. BiiGGA funds can be paid back daily, weekly or according to the cyclical nature of the business’s turnover – a cafe might receive income daily, but a plumber might send out invoices only once a fortnight.

Perhaps the real genius behind the company’s partnership with BiiGGA is that it enables Attvest to provide pre-approved offers to its existing customers referred by Attvest brokers, allowing brokers to earn a referral income. Attvest and BiiGGA have access to behavioural data on this market segment, and BiiGGA can manage its lending risk to ensure that customers can be pre-approved, which reduces the need for an onerous application process and lengthy turnaround times. The suite of products is a testament to the nimbleness and innovation that characterises the Attvest approach. Brokers looking for an edge in catering to their customers in tougher times would do well to add such out-of-the-box options to their arsenal.

Top management calculating finances with a calculator, laptop and charts.

Enter the debtMAN

Partnership with BiiGGA helps support SMEs in uncertain economic conditions

Published 14 August 2023

“We see [BiiGGA] as another way to further cement the broker’s relationship with their clients”

Nick Cunningham, Attvest

Aged debtor reports are processed, identifying new overdue invoices, existing invoices that require amendments and invoices that have been paid

Client is contacted and assisted with paying the invoice; multiple payment options are offered as agreed with the broker

ATTassist team keeps the broker in the loop with any issues or feedback from the client

BiiGGA funding repeat customer rate – May/June

70%+

Source: BiiGGA

Generating sustainable business

It’s clear that many brokers are becoming overwhelmed by the task of debt collection, with some seemingly putting it in the too-hard basket. There were brokers who didn’t even know who their debtors were when they asked Attvest to help. Cunningham says there were cases of a debt being paid and the broker having no record of it, and others that were more than 240 days overdue and the broker hadn’t caught it – it was as if they had shoved all their overdue accounts into the bottom drawer and forgotten about them. Attvest also knows that if that bottom drawer ever does get opened, it can often be to hand the unwieldly pile to a non-expert staff member as a task that no one else wants to deal with. "In most instances we found that brokers have no option but to use their least experienced resource to follow up debtors," Cunningham says. But when debtMAN is deployed, brokers are able to understand who their debtors are and unblock the logjam in terms of cash flow. “Probably the most successful part of it early on has been that we’ve actually reduced the debtors down for the brokers.” Many brokers have been surprised that Attvest isn’t just trying to sign up more customers for their premium funding, and they are especially impressed to learn that over half the accounts end up paying their debts in full. “We don’t send them back to the broker to execute that transaction. We look after it for the broker, providing a full platform payment service,” Cunningham says. And if the customer does need further options around payment, Attvest has the expertise to provide a range of solutions. “We can say, ‘Well, you can pay up front, you can pay it in eight instalments, 10 instalments or 12 instalments’, effectively giving the clients more options to get that debt paid. We can quote on multiple payment options [and] we can do that through our systems a lot more efficiently than what the broker can.”

Like many alternative lenders, BiiGGA provides lightning-fast funding approval – funding can be approved within a matter of hours. Through its partnership with BiiGGA, Attvest is riding on the trend of traditional banks pulling back from supporting SMEs, as well as the growing demand for alternative funding options as a result of higher interest rates and the reduced risk appetite of traditional lenders. Not surprisingly, demand for its products accelerated towards the end of the last fiscal year as monetary policy continued to tighten and consumer spending wavered. “The May and June demand [levels] were exceeding our expectations, with a repeat customer rate of over 70%,” Cunningham says.

Helping brokers manage debtors

For brokers, being able to offer an alternative option when it comes to unsecured working capital, especially a product with flexible repayments, which can be approved in a matter of hours, is an attractive string to add to their bows. “We see this as another way to further cement the broker’s relationship with their clients,” Cunningham says.

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