If you are the kind of business person who likes to do your own account or contribute to your accountants job at the end of the financial year, you’ll be very organised and have file containing all of your invoices and receipts so that your accountants job is much simpler. Not all of us we must admit are this organised, but the thought is there.
So if you are that type of business person who now needs some extra funding from somewhere, to either pay staff, buy new materials or machinery, and help the company grow, after all, SME’s are the fuel of the economy and need all the help they can get.
There is a solution to such a problem in Invoice Discounting. It’s a form of factoring and it allows you to gain capital tied up in invoices that you would send out to clients. You could wait for clients to pay the bill, but you could be waiting up to 90 days for this. Or you could opt to use Invoice Discounting which will give you that capital in about 24 hours.
Simply contact a factoring lender, inform them about your invoices and send out the invoices to clients. Now this is where being an organised business person comes in, you can simply gain the capital and continue chasing clients for payment, so you know exactly where you are with your finances. That’s the beauty of Invoice Discounting, nothing changes in the process of chasing payments apart from the fact that you will receive up to 85% of the sum of the invoices. Once all the invoices have been paid, you will receive the rest of your invoice sum minus a small fee, which is for using the Factoring Lenders services and having that money upfront when you really need it. Some people love to dabble in finance, and some of us can’t bear it, that’s why there are a range of Factoring solutions.