Why should my business use invoice finance?

Invoice finance can be a brilliant way to release funds to the business. We can help you get up to 90% of an invoice, released to your business within 24 hours. If you’re having problems with cash flow, growth or even spending enough time working on the business, then using an invoice finance facility, could be the solution to all those problems.

Our invoice finance services

Within our invoice finance options are, factoring, invoice discounting and spot factoring/ single invoice factoring. Although all are similar each is slightly different.

• Factoring – Factoring is a service where a lender makes an advance to your company, based upon the value of your invoices. Typically, they will lend up to 90% after assessing the quality of your invoices. The factoring company will then collect your invoices for you, before claiming what they are owed along with their fees and then returning the remaining balance to you.
• Invoice Discounting – Invoice Discounting works in a very similar way to factoring. However, it is normally for larger, more established businesses who want a confidential facility whilst retaining their own credit control function. During the process of invoice discounting, the business will collect its own invoices, accounting to the factoring company for any amounts due.
• Spot factoring/Single invoice – This is a relatively new product in the UK and can act as a stop gap. Spot factoring provides you with working capital in exactly the same way as factoring and discounting. It is designed to meet one-off cash flow shortages and doesn’t require the same long-term commitment. Companies requiring regular facilities will find full factoring or invoice discounting more cost-effective.

What sort of businesses use factoring and discounting

Although both are similar, typically the two services will be used by very different types of businesses. Users of factoring are generally younger, smaller businesses – often with ambitious growth plans. They may welcome the fact that the factor will manage the ledger and collect invoices. In the right circumstances, it is available to start-up businesses. The cost of factoring is generally greater than invoice discounting.

Larger, established companies who want to be discreet about the fact they are using a factoring company, will tend to use invoice discounting. This gives them that little bit of privacy when collecting invoices and allows them to have more control when it comes to collecting. As the company is not being charged for credit control services and is an established business, it generally costs less to use invoice discounting than factoring.

What can we do for you?

If you think an invoice finance facility would aid your business, either with cashflow troubles or growing and progressing as a company, it’s vital to get the most appropriate deal. Invoice finance can provide an injection of cash to either aid a difficult period or take your business to the next level.

We can help you secure the best invoice finance facility for your business, designed to fit the needs and growth of your business. We are brilliantly positioned to negotiate the right deal for you, working closely with the top blue-chip lenders, we are able to get exclusive rates and deals that otherwise would be unattainable.