How does invoice finance work?
A step by step guide to the invoice finance process.
What is invoice finance?
Invoice finance releases up to 90% of an invoice's value within 24 hours to avoid the delays in getting paid commonly experienced with trading on credit, thus helping improve cash flow to provide the necessary working capital for businesses to focus on their day-to-day tasks.
Also known as accounts receivable finance, invoice finance is the umbrella term for factoring and invoice discounting solutions that can be tailored to suit a company’s individual cash flow requirements. In addition, invoice finance can be incorporated into solutions such as asset based lending, international finance and payroll solutions.
What are the benefits of invoice finance?
- Invoice finance is more flexible than more traditional finance for business as the cash you can access grows in line with your sales ledger.
- By boosting your cash flow in just 24 hours, invoice finance allows you to bridge the cash flow gap between paying suppliers and receiving payment from your customers.
- Invoice finance enables your business to negotiate supplier discounts.
- Credit control can be built into the factoring invoice finance solution to reduce in-house overheads and improve your business’ sales ledger management.
- Credit protection can be added to either the factoring or invoice discounting invoice finance solutions to protect against debtor insolvency or protracted default.
- Invoice finance can be used to help fund acquisitions or mergers.
- Unlike a bank overdraft, invoice finance solutions cannot be recalled on demand.
Which invoice finance solution best suits my business?
Invoice finance solutions can be tailored to suit the individual cash flow requirements of businesses across most sectors. With over 70 invoice finance companies across the UK and Europe from high street lenders to independent finance houses, speaking to a specialist invoice finance broker will help to save time and money when searching for the right facility to help improve cash flow.
Factoring allows you to focus on your core business by improving your cash flow while the factoring company provides a dedicated sales ledger management service. Debtor protection can also be incorporated if required.
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Invoice discounting solutions enable you to access cash against your invoices whilst retaining control of your sales ledger and credit management. It can be provided on a confidential or disclosed basis, depending upon the needs of your business.
Read more about invoice discounting...
Single Invoice Finance
Unlike traditional invoice finance products, single invoice finance enables businesses to unlock cash that’s tied up in a single invoice. This is particularly useful for highly valued invoices or those with long credit terms.
Read more about single invoice finance...
Asset Based Lending
Asset based lending releases cash against a range of assets to help a business improve cash flow and, by incorporating a variety of asset based products, this solution can be tailored to meet each business’ specific needs.
Read more about asset based lending...
There is a variety of international finance solutions that can offer support to businesses trading overseas, whether they are an importer or exporter based in the UK, have offices abroad or are a multinational organisation.
Read more about international finance...
Payroll solutions incorporate a range of facilities to ultimately assist businesses in all industry sectors to overcome the issues caused by the need to pay staff wages before receiving payment from customers.
Read more about payroll solutions...
Specialising in factoring, invoice discounting and invoice finance as the UK’s leading independent invoice finance broker, Hilton-Baird will be able to identify the most appropriate and cost-effective invoice finance facility and provider to help your business improve cash flow.
To understand more about which invoice finance solution meets your business’ cash flow requirements, call us on 0800 9774833 or email firstname.lastname@example.org. Alternatively, you can get an invoice finance quote in three easy steps.
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