Business Blog
Posted on 02 May, 2011Invoice finance will immediately boost your cash flow
The number one reason for SME’s using invoice finance in the form of invoice factoring or invoice discounting is to provide an immediate cash injection for working capital.
Other reasons cited as important considerations in the decision to use this effective funding solution are:
- Direct access to credit checking facilities
- The availability of professional credit control and debt management
- The flexibility of the facility
- The ability of the funding to grow as sales grow
- The fact that it doesn’t restrict other borrowing facilities
- It generally doesn’t require directors guarantees
Invoice finance explained
Invoice finance is the generic term used to describe the business funding facilities of invoice factoring and invoice discounting both of which are explained below.
Invoice factoring
Invoice factoring can advance up to 95 % of the value of your unpaid sales invoices. This provides an immediate cash injection and enables you to raise funds as invoices are raised and not have to wait until your customer pays.
Credit control is usually undertaken by the invoice factoring company but some offer options on whether or not you prefer to undertake this yourself.
Once your customer pays the invoice factoring company they will remit the balance due to you less their charges.
The process is simple and easy to operate.
Invoice discounting
Invoice discounting is a confidential facility which enables you to raise funds immediately against your unpaid invoices without your customers knowing about it.
This method of invoice finance will advance up to 90% of the value of unpaid invoices and you remain in control of collecting your outstanding debtors.
This type of facility is usually only available to companies with a minimum level of turnover determined by the lender, and who have a recognised and systematic procedure for credit control.
About us
The invoice Finance Company is one of the UK’s fastest growing independent finance brokers. We do not charge for consultations, advice or financial assessments, so if you would like to find out more about invoice finance including invoice factoring and invoice discounting feel free to call us on 0845 459 7504 or email us at info@invoice-finance-uk.co.uk
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What our customers say
"We found The Invoice Finance Company to be absolutely terrific. They arranged an invoice factoring deal for us quickly and efficiently. Would certainly recommend them"
David Livingstone, Operations Manager, Aspect Work at Height Ltd
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