Interest rates rising, inflation growing and access to finance becoming increasingly difficult… What’s this sound like? An old-fashioned credit squeeze, according to David Koch.

I don’t think I’m telling you anything new, but I think we are in just an old-fashioned credit squeeze now. Not only are interest rates rising, but also liquidity as getting access to funds is more difficult as the financial institutions tighten their lending criteria.

As a result, managing cash flow becomes a whole lot tougher. So how can we set our businesses up for success when the odds aren’t necessarily in our favour?

In an old-fashioned credit squeeze, we’ve got to spend more time as business owners focusing on our financial relationships. This means not just paying careful attention to our books but also to our customers and suppliers. Ensuring your customers pay on time and stick to your credit terms is essential when cash flow is tight.

But it doesn’t stop there. We also need to be certain we are getting the most bang for our buck with our financial providers. What has your bank or fintech been doing for you lately? When was the last time you renegotiated your finance?

Because never has it been more important to make sure you get the best deal, either through a traditional financial institution or using new technology.

Last week Apple made a splash in the financial news with the launch of Tap to Pay. This new payment system eliminates the need for a merchant terminal and is set to be a game changer for business owners.  All that’s needed is an iPhone and a partner-enabled iOS app and you’re ready to start accepting payments with just your phone… Bye-bye hardware and super high merchant fees… No wonder the big card companies are nervous.

What’s really interested me about Apple getting into the payment system, is that Apple is almost becoming a bank. Now, it’s early days. They just announced it. But I reckon they are going to transform the banking industry and financial services like never before.

They’re going to take a tech view, like fintechs, such as Square or Tyro has done, they will provide more competition to the traditional financial relationships that we’ve all built into our business.

But it’s up to us as business owners to understand what Apple is doing, to understand the other fintechs that are in the marketplace and the non-traditional fiancé options for our business that way we can make sure we do a deal that’s best for us.

Now, if you are with a traditional financial institution, of course, if you can get a better deal elsewhere, go to your traditional bank first and say, “Hey, can you match it?” If not, then don’t be afraid to change. Because when money is tight, when credit is tight, we’ve got to get the best deal for us.

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