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Invoice finance

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Invoices can take a while for customers to pay, sometimes up to 90 days. These and late invoice payments can throw your business’ cash flow into chaos and lead to greater problems later. We can help resolve these issues by offering invoice finance; helping your business keep its cash flow moving and allowing it to grow.

What is invoice finance, and how can it help my business?

Invoice finance is a general term for a number of different products that all release the value in your company sales ledger. The procedures involve a third-party factoring company lending a business a pre-agreed percentage of their sales ledger. Once the invoice/s are paid in full, the factoring company takes a fee for their services before releasing the rest. These arrangements are particularly useful in limiting a late-paying client’s effect on your cash flow.

invoice finance

Invoice factoring

The main type of invoice finance is invoice factoring. The process works as described above and can even get the cash to your business account within 24 hours. This fast access to funds can be useful if you’re looking to expand and removes the burden of credit control. It also prevents a late-paying client from negatively impacting your company’s cash flow.

While traditional factoring can be a long-term commitment, it can be used for one single invoice; in a process called ‘spot factoring’.

More information on invoice factoring

Factoring is best-suited to smaller businesses, or those still in the starting-up phase.

Invoice discounting

Invoice discounting works similarly to factoring. However, the company maintains its own credit control. The business still collects its invoices, accounting to the factoring company for any amounts due. This maintenance of independent credit-control makes invoice discounting an attractive option for larger companies with credit management procedures, rather than smaller businesses.

More information on invoice discounting

In summary

When a client is late in paying their invoice, it can have a knock-on effect on your business’ cash flow and lead to further problems. Invoice finance is a fast, flexible way to alleviate these potential issues at an early stage. The processes are suitable for both large-scale companies, and smaller ones just starting out. By allowing your business to borrow money against the value of the unpaid invoices, it allows you to focus on other issues aside from chasing those late-paying clients.

How we can help

If unpaid invoices have affected your cash flow, and you need a fast injection of funds, either through invoice factoring or discounting, speak to us today. We have years of experience in the industry and can help you secure the best financial solution for your business. All initial advice is free and impartial with no obligation.

Beverley Horton

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Authored by Richard Froggatt

Richard Froggatt

Senior Consultant

Beverley Horton Christopher Callaghan Stephen Hall

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