Block Discounting

Block discounting is a form of funding for lenders and independent finance providers allowing immediate access to the capital tied up in customer finance agreements. This means that new business pipelines can be maximised enabling more efficient growth of the lending book.

HOW DOES IT WORK?

As a lender you will be underwritten for a credit line. The terms of your credit line are structured specifically to you and your lending book. When you wish to draw against the credit line, you will send a “block” of your own finance agreements to PEAC who will pay a “discounted” percentage of the value of these back to you. A loan agreement is set up with the repayments structured to match the profile of the underlying “block” of agreements and are repaid over the average life of those agreements. In this way it will remain a cash positive transaction for you.

For more information on how Block Discounting works, please contact info@peacfinance.com

FOR OUR CLIENT

Independent finance company
Repayment of the loan linked to payment of receivables - cash flow management
Long term capital tied up in existing agreements
Undisclosed to their end user
Capital release via a loan against a block of agreements at a discounted rate
Reinvest capital into new agreements

FOR PEAC

Annual review of credit line
Vendor pays monthly block loan repayment
Quarterly audit of receivables
Any defaults or 3+ arrears are replaced with ‘good’ paper

BENEFITS OF BLOCK DISCOUNTING

  • Funds can be released within 24 hours
  • Our client retains control over their lending, collections, and customers
  • There are no non-utilisation fees
  • The facility is uncommitted and undisclosed to your clients
  • The funding is fixed term, providing cashflow certainty

Block facilities at PEAC range from £0.5 million to £10 million and can be drawn against the below assets:

  • Agricultural
  • Plant & Machinery
  • Professions loans
  • Soft assets
  • Vehicles

This list is not exhaustive, but an example.


To request more information please get in touch with
For the latest from our Block Discounting team