The alternative to banks for payments and cash flow finance

Gather the CEOs of any type of business and the first topic of conversation is how banks are mistreating them, how banks are late in their response and inflexible and how frustrating it is to secure financing from the banks.

The problem experienced by business owners is not with one specific bank, but with all of them, which brings one to the conclusion that “banks have trapped customers” otherwise there would be a mass exodus to other financial institutions offering better services.

Since deposit rates offered by banks is near zero, there is no longer a case to keep money in the bank to earn a living. In any event, memories are still fresh from the haircut suffered by all those who had deposits with the failed Laiki Bank and the recent banking crisis hitting depositors with Lebanese banks.

The message from the ECB is clear! Don’t save, spend.


SEPA and Swift

So if we are encouraged to spend and make payments, the question arises if there are alternatives to banks? Fortunately, the answer is yes.

Individuals and businesses now have the choice to open accounts with Electronic Money Institutions (“EMIs”) and Payment Institutions licensed by the Central Bank of Cyprus or other European Central Banks to make SEPA and Swift payments. Some of the EMIs are offering very competitive pricing on incoming and outgoing SEPA and Swift charges, so its always a good idea to shop around and not rely exclusively on the banks.

You may view all the licensed EMIs from the Central Bank of Cyprus web site link at press on Register of Electronic Money Institutions authorised by the CBC.



In addition to incoming and outgoing payments, every business needs financing for its working capital needs. The alternative to borrowing through a loan or overdraft facility is trade finance via invoice discounting.

An alternative funding provider solving cash flow problems is Eurivex Trade Finance Limited ( which offers invoice discounting for both domestic and international business.

In sharp contrast to the banks, Eurivex does not require personal guarantees or tangible securities in the form of mortgages and floating charges on businesses.

The seller gives credit of up to 120 days to its buyers and after assigning the credit invoice to Eurivex, it secures immediate cash. The assigned invoice is the only collateral required. A company that does not have strong financials can still apply to Eurivex if the quality of its debtors is good.

After the limits on the debtors are agreed, the business presents its invoices pertaining to pre-approved clients which are discounted immediately. The business thus receives instant cash of up to 85% of the invoice value and the balance less the agreed fees upon settlement of the invoice.

Such financing arrangements are also useful for businesses looking to reduce their risk as Eurivex combines financing with credit insurance through its arrangement with Euler Hermes whereby the credit invoices issued to buyers are insured against default.

A business owner has thus multiple opportunities to move away from the banks and start utilizing new innovative services offered by financial institutions. It is time to stop complaining and act now!