Invoice financing (factoring) is simply the selling of your invoices or receivables at a discount to a “factor” for immediate cash. The discount is typically 10% to 20% or so of the value of the invoice. The factor makes their money by collecting the payments from your clients. It is an excellent way to finance a business without the worries and time spent going after standard bank loans.

How Is Invoice Financing Useful?

Invoice financing allows businesses to borrow based on invoices that they are owed by their customers. This provides SMEs with a great short-term financing option with lower interest rates than other short-term financing methods.

Invoice Financing releases cash currently tied up in outstanding customer invoices – ideal for funding expansion plans or improving your cashflow.

It is structured as a secured line of credit, therefore the lender will feel safer. Invoices act as collateral against money borrowed.

The lender limits the risk by lending a percentage of the total invoice amount and the balance acts as a fee.

If a client is unable or unwilling, the lender basically become the creditor rather than the company.

There are two main types: Factoring and Invoice Discounting.

With factoring we provide both funding and credit control. With invoice discounting only the funding is provided.

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Invoice Financing / Factoring Benefits

  • Speed

    – Access to the funds held in your invoices within 24 hours so you don’t have to wait to be paid.

  • Cost-Effective

    – We aim to give you the best value we can based on your specific requirements.

  • Choice

    – Outsource your credit control and sales ledger management to our expert teams or handle them yourself.

  • Personal

    – Our country-wide presence and relationship managers ensure we can give a more personal service.

  • Confidentiality  

    – Our confidential service means we won’t disclose you are using an invoice finance facility.

  • Security

    – Protect against customer insolvency with Bad Debit Protection

  • A company can have a few trade lines and make your business more flexible and efficiency.
  • One line, multiple products for both import and export use.
  • Now the Credit lines of up to 10 times the amount of security provided.
  • It allows you to use Letter of Credit, Trust Receipt, Shipping Guarantee, Bills Purchase and Invoice Financing etc to meet your trading and business requirements needs.
  • Up to 120days and Interest chargeable only when you use the line extended to your company.
  • Absolutely hassle-free application process.