Payments firm lands £20m from HSBC as it rolls out fast settlements network

Proactis said the system would boost the liquidity of small businesses.

Payments firm Proactis has secured £20m from high street giant HSBC as it prepares to launch a new system to speed up settlements to cash-strapped small businesses.

The Aim-listed firm, will roll out its ‘frictionless cash flow’ system later this year, which it says “accelerates and incentivises payments, helping small and medium sized enterprises [SMEs] in particular to invest in growth through improved liquidity”.

Late payments of longer than three months, leading to meagre cash flow, is regularly cited as the number one reason for small firms going bust.

Sixty-one per cent of small businesses reported problems with cash flow, and 32 per cent added they could not pay back vendors, pay loans, or pay themselves because of cash-flow issues, according a survey called, The State of Small Business Cash Flow, by software company Intuit released earlier this month.

Proactis financial solutions director Anthony Persse said: “We have been exploring technologies that can improve access to working capital by accelerating payments to suppliers. Through our accelerated payment technology, we will re-establish positive business practices through effective collaboration and simple access to cash.”

The Wetherby-based firm, founded in 1996, said the cash from HSBC was “a vital milestone” in the launch of its accelerated payment facility later this year. It said it would use the funds “to support early adopters of the technology”. HSBC has 14.5 million customers in the UK.  

Proactis added that its system would also help larger firms to better manage their supply chains, easing the impact on working capital.

HSBC UK global relationship director Wayne Shadlock said: “We began working with Proactis over 15 years ago and this is yet another example of its innovative thinking. We have a keen understanding of the benefits of accelerating payments through the supply chain and the new technology is both scalable and unique to Proactis."

Shadlock added: “The business [Proactis]  is well positioned to drive widespread access to liquidity for SMEs, which will ultimately boost cash flow and support economic growth.”