What Is Invoice Finance?
Invoice finance allows you to unlock cash tied up in unpaid invoices before your customers pay. Rather than waiting 30, 60 or 90 days for payment, a lender advances you a percentage of the invoice value — typically up to 90% — almost immediately.
Who Is It For?
Invoice finance is ideal for businesses that invoice other businesses (B2B), have slow-paying customers, or experience cash flow gaps between delivering work and receiving payment. It is particularly popular in sectors like recruitment, construction, manufacturing and logistics.
How Much Can I Access?
Funding is linked directly to your outstanding invoices. Businesses can typically access between £10,000 and £1,000,000+ depending on their debtor book size and customer quality.
Types Of Invoice Finance
- Invoice Factoring — the lender manages your sales ledger and collects payments from your customers on your behalf
- Invoice Discounting — you retain control of collections; the facility is often confidential so customers are unaware
- Selective Invoice Finance — finance individual invoices rather than your whole ledger
What Are The Costs?
Costs vary by product and provider but typically include a service fee (as a percentage of turnover) and a discount charge (similar to an interest rate on the amount drawn). Your broker will present options suited to your situation.