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What Is Invoice Finance

Invoice finance is a flexible and cost effective alternative to bank loans and overdrafts for start-ups and other fledgling businesses. Your business gets instant access to the cash flow you need to grow without having to worry about exorbitant interest rates or inflexible long term repayment schemes.

How? Simple: funds are drawn against invoices as they are raised, rather than when you receive payments.

Invoice finance is the ideal solution for growing businesses as the available finance facilities grow in line with your turnover. The more money you make, the more funds you’re able to release. So any time you need to invest in new stock, equipment, assets or marketing, you’ll always have ready access to the cash you need.

Broadly speaking, there are five main types of invoice finance:

  • Factoring – A financial transaction in which your business sells its accounts receivable to a third party at a discount as a means of meeting your present and immediate cash needs.
  • Invoice Discounting – A solution for those who already have a solid financial system in place, invoice discounting provides working capital against your invoices without the need for a lender to operate your credit control.
  • CHOCCS – Stands for Customer Handles their Own Credit Control. This option is perfect if you have strong relationships with your customers and you want to keep things this way.
  • Payroll Finance – This facility is specifically designed for recruitment companies who place either temporary and/or permanent staff. Cash can be released while paying temporary staff and credit control can be handled while maintaining payments to HMRC.
  • Trade Finance – Any UK importers who require upfront funding against secured orders can make use of our trade finance service in conjunction with any other invoice finance facility.

No matter how long you’ve been trading, and no matter what sector you’re operating in, our invoice finance services can give you fast, flexible, and secure access to the cash you need to grow. Click here to learn more.