Barclaycard Targets Construction’s Cash Flow Struggles With SMB Cards

As the U.K.’s construction industry continues to struggle with late supplier payments, a new commercial card product from Barclaycard aims to address some of the cash flow issues among small businesses (SMBs) in the sector.

In an email to PYMNTS, Barclaycard announced the rollout of a co-branded commercial card suite for SMBs in the U.K. In collaboration with construction materials supplier Travis Perkins and retailer Toolstation, Barclaycard’s new line of commercial cards targets SMBs in the construction sector with an extended interest-free period. Businesses using the card to make purchases at Travis Perkins and Toolstation will not have to pay interest for 116 days, the companies said. Barclaycard noted it plans to add additional retailers to the card and its extended interest-free offer moving forward. SMBs making purchases with the card at other retailers will have up to 56 days without interest, the firms noted.

Barclaycard cited proprietary research that revealed 20 percent of small businesses agree cash flow is among the largest day-to-day challenges to growth.

“We’re excited to launch this partnership with Travis Perkins and Toolstation, two of the biggest names in the industry,” said Ian Reid, director of small business at Barclaycard, in a statement. “While cash flow remains one of the main challenges for any growing business, we know that the construction industry in particular is comprised of many sole traders and small teams that frequently make upfront investments before they themselves get paid. We hope our extended interest-free offer will be another way to help them take control of their cash flow.”

Research suggests late payments are a particularly threatening problem in the U.K.’s construction sector. Data from Racplus, released last month, found nearly three quarters of the 400 small construction firms surveyed are facing severe financial challenges, with a 27 percent year-over-year increase in the number of firms linking poor mental health to cash flow struggles.

Late supplier payments are linked to suppliers’ inability to pay themselves and their employees, the research noted.

Paul Tallentire, CEO of Travis Perkins General Merchanting Division, said in another statement, “Managing cash flow is one of the biggest challenges for the trade. With this exciting new credit card built for the trade, Travis Perkins will make it easier for our customers to keep doing what they do best — building.”