What is invoice finance?

Invoice finance is the collective term for factoring and invoice discounting products. These types of funding facilities free up cash from your invoices raised for completed orders as soon as they are issued, giving you an instant injection of funds that grow in line with your business and can also protect you against late payment from your customers.

Key benefits of Invoice finance for your business:

Benefit	Description
Improved cash flow	Invoice finance improves your cash flow by releasing money as soon as you've completed an order and raised an invoice, rather than having to wait for your customer to pay. Invoice finance is ideal for start up and growing businesses as it funds growth and can be strategically used for larger organisations to help finance corporate reconstructions, MBOs and MBIs. .
Confidence to grow	Improved cash flow can create the confidence for you to tender for new business and start work on new orders without delay. You can settle bills promptly, improving supplier relationships and possibly secure early settlement discounts.
Accessibility	Factoring and invoice discounting gives you immediate access to funds for work completed. It is a cost effective way of improving the cash flow of your business, ideal if you do not have access to other forms of funding. This accessibility is often vital for new or growing businesses.
Flexibility	The amount you can borrow grows in line with sales and without the need for you to re-negotiate limits or pay arrangement fees. When using a factoring facility it’s often possible for you to repay bank facilities and release previously pledged security. Some factoring providers are also prepared to provide finance against other assets, or even unsecured loans, as part of a packaged solution.
Free Up Management Time	With a factoring facility, the factor will manage your sales ledger by chasing and collecting outstanding invoice payments from your customers on your behalf, freeing up valuable management time.  This is a cost effective way of outsourcing your sales ledger management.