Invoice Finance

Solutions

Boost cashflow by getting paid faster for your completed work

Any successful business can hit cash flow problems.

If you need an immediate injection of cash, and you regularly invoice businesses which take a while to pay, then invoice financing can help you release funds tied up in those unpaid invoices.

Invoice financing can be incredibly flexible and there’s two main options.

  • Invoice discounting. Simply releases the cash from your unpaid invoices. This can be ideal for lower volumes of invoices or where you have plenty of resource to manage your sales ledger. For added comfort, most funders will offer protection against bad debts.
  • Factoring. In addition to invoice discounting, this provides more support with a full sales ledger administration service including credit control and chasing your customers for payment. If necessary, this can be done confidentially, so your customers will not be aware you have outsourced this. It is designed to grow with your turnover and could be the best solution if you have a high volume of invoices and don’t have enough time to manage them.

 

As we come out of the pandemic, this type of finance will be increasingly useful. For example, you could use it to support your customers and build long-term loyalty, by giving them longer to pay, without impacting your cashflow.

We have personal relationships at a senior level with every major funder in the UK so are very well placed to find the right solution and funding partner for your unique circumstances.

  • Cultural fit. It’s vital that the funding partner is a good fit for your business. For factoring in particular, they are an extension of your organisation and have contact with your customers.
  • Practicalities: We also ensure the partner can deliver the required speed of set up, best value fees as well as bad debt cover if you need it.

Find out if we can help your business with Invoice Finance

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FAQs

Q: What is invoice finance?

A: Put simply, Invoice Finance is the sale of a business’s unpaid invoices to an Invoice Financier for a payment equivalent of up to 100% of the value of invoices. This enables the business to get instant access to the cash they’ve earned, when normally they have to wait 30, 60 or even 90 days for debtors to settle invoices and so for the money to appear in their bank account.

Q: How quickly can an invoice finance facility be arranged?

A: Invoice finance facilities can be arranged in as little as a few days. Most applications are usually completed in a time frame between 10 days and two weeks, with transfers from other providers usually taking slightly longer. If you need your facility to complete very quickly, just let us know and we’ll ensure that your application completes within your required timescales.

Q: How Much Money Can I raise using invoice finance?

A: It’s possible to release up to 100% of your outstanding invoices, although this is exceptional. It is more realistic to expect an advance rate of 80-90%. This means that with an outstanding sales ledger of £100,000 you could expect to release around £80,000 – £90,000..

Q: Will I need to provide a personal guarantee?

A: The quick answer is yes, most invoice finance funders require a personal guarantee from a director, however we have a proven track record negotiating with funders to minimise this requirement, and in some cases remove the requirement altogether.

Q: What is the difference between Invoice Discounting and Invoice Factoring?

A: While Invoice Factoring and Invoice Discounting might seem the same, there actually is a big difference. With Invoice Factoring the responsibility for collecting payments and sales ledger management will be undertaken by the funding provider. With Invoice Discounting the responsibility for collecting payments and managing the sales ledger remains with you and your team.

Q: Is invoice finance suitable for funding against uncertified and certified Applications for Payment?

A: Yes, although it requires a specialist touch. We work with a number of funders who can provide a product known as Construction Finance which provides your business with instant funding against uncertified and certified Applications for Payment and invoices raised at completion. Our funders help you to meet your payment obligations throughout the various stages of a contract so you can and take on more work knowing you have reliable funding in place.

Q: How do I know if I am eligible for an Invoice Finance facility?

A: As a general rule, If you are a business that provides a service or product on credit and raises invoices, you may be eligible for Invoice Finance. Contact us directly to discuss your individual business needs.

Still got a question?

Let’s chat it over. We’d love to hear from you. Just give us a call or email us.

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Case Studies

View all case studies

Rapid Turnaround of Asset Finance Deal Ensures New Contract Win for Scot Hoist

Scot Hoist required funding to purchase two new hoists for a new business opportunity. The asset finance deal was proposed and agreed in under 24 hours and the client won the contract.
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D&M Winchester Ltd

We recently helped D&M Winchester Ltd to secure a CBILS loan of £400k to allow them to accelerate expansion of extra warehousing space to accommodate growth.
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Teal Engineering Services

A perfect candidate for CBILS, Teal Engineering Services had a cash requirement in order to safeguard cash flow and to help with the purchase of various machines due to a reduction in cash flow during the lockdown period.
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