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Invoice Financing

Small to medium businesses will be please to know, if they didn’t already, that there are a range of options to gain finance simply and quickly without having to take out a loan, and basically using the money tied up in invoices that are being sent to clients.

Select Factoring specialises in Factoring, which is a way to gain capital using invoices, invoice financing if you like.

There are an array of options but we’re going to focus on a solution called invoices discounting. If you have a system in place where you have accountants and so on in your business, or take control of your own finances, you may feel that because you’re in control you want to be able to know where you are in terms of invoices and payments. This isn’t a problem. The process of Invoice discounting allows companies to send out invoices to their clients but using a factoring lender, gain the capital tied up in those invoices, generally within 24 hours. You then continue to chase payments from your clients. Unfortunately if payment terms are up to 90 days you will generally be waiting a very long time to get your money, but with invoice discounting you can have the money way before the payment deadline is due.

Having the capital allows business to continue. There have been great success stories of companies being able to grow, using the capital to employ new staff or purchase new machinery or vehicles.

It really is an incredible solution, unfortunately there is only a small percentage of UK businesses that know about Factoring and Invoice discounting.

The last part that people may question is the cost of using such a service, believe it or not, factoring is only a tiny cost compared to the interest you could pay on a business loan.

 

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