The speed and convenience of these facilities may appear empowering, but the long-term impact on profitability, resilience and sustainable growth is often damaging.

Short-term lending has an important role to play in the funding ecosystem. The issue is not access to capital, it is the cost and structure of that capital. Repeated use of high-interest, short-duration facilities can compress margins and create a cycle where businesses are focused on servicing debt rather than investing in growth.

This trend also highlights a broader structural issue within SME finance: many business owners are making funding decisions under pressure, without the time or advisory support to fully evaluate long-term implications.

When capital is accessed reactively rather than strategically, even well-performing businesses can find themselves constrained by repayment schedules that outpace their natural cash flow cycle. Over time, this misalignment between debt structure and business model becomes a drag on performance.

One practical step for SMEs caught in this cycle is to reassess their overall debt structure. Consolidating multiple short-term facilities into a single more structured funding arrangement can materially reduce interest exposure and improve cash flow visibility.

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At Albatross, we have seen how a considered approach to debt consolidation can help businesses regain stability — not by adding more borrowing, but by reshaping existing obligations into something more sustainable.

It’s important to acknowledge that consolidation alone is not a permanent solution. The stabilisation loan at Albatross is deliberately structured as transitional finance, providing a three-year runway for businesses to consolidate existing obligations, restore financial equilibrium and refocus on operational performance.

The objective is to provide breathing space, not to create long-term dependency. By stabilising cash flow and strengthening financial positioning over the loan period, businesses place themselves in a far stronger position to access longer-term, lower-cost funding options in the future.

In that sense, this is not merely a refinancing exercise but a deliberate bridge toward stronger, more sustainable capital structures.

This solution is part of a broader conversation the industry needs to have about responsibility and long-term viability. Access to fast capital should not come at the expense of financial health.

As lenders and advisers, we must ensure that SMEs are supported with funding structures that strengthen balance sheets rather than quietly eroding them.