Invoice factoring is a way for businesses to raise money by selling invoices to a factoring company at a discount. Factoring usually includes credit control services, and helps companies release cash from their debtor book.
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Invoice Factoring - Features and benefits through Funding Options:
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Invoice Factoring - How does it work?
A factoring provider lends against your customer invoices, this enables you to receive most of the invoice cash value immediately rather than waiting weeks or months to get paid.
The amount of finance available will typically be stated as a percentage of your outstanding debtor book or sales ledger, but may be constrained by specific terms such as limiting exposure to a single large customer.
Typically, payments from your customers will go into a bank account controlled by the factoring company, and your customers will be aware that you use factoring.
From the lender’s perspective, factoring is lower-risk because they’ll have more control over ensuring your customers pay you on time. Factoring is often what lenders favour for companies with low turnover, a short trading history, or other challenging circumstances.
7.63% APR Representative based on a loan of £50,000 repayable over 24 months. Monthly repayment of £2,252.94. The total amount payable is £54,070.56
*Some lenders may apply fees during the application process, please note that these are set and provided by these entities.
Annual Percentage Rate
Rates from 2.75% APR
1 month to 30 years terms