Invoice Finance has become the most popular choice for small, medium and large businesses to fund their working capital. It is easy and hassle free to set up with the Financial Institution taking the companies invoices and debt ledger as direct security.

It is one of the most effective and flexible funding methods available, as the facility grows with your business. Additional features can be added including customer credit checking, credit control management and debt protection.

Invoice Finance is the term given to a range of services designed to provide working capital and improved cash flow by advancing finance against newly generated unpaid invoices. It is a great way to provide flexible working capital as the finance facility has the ability to grow with the sales of your business; there are two main Invoice Finance products.

Invoice Factoring has the ability to advance up to 95% of the unpaid invoice value. The credit control is normally undertaken by the Financial Institution offering the facility but a few providers offer the option for the business to carry out their own debt collection process to reduce costs for this part of the service.

It allows your business to advance funds on invoices waiting to be paid by your customers which as you probably already know in the current climate can take some time and can represent up to two or three months sales depending on your credit terms. This means you can unlock precious working capital to fund new orders, business expansion or mergers and acquisitions, while the finance provider controls the sales ledger and collects all the outstanding debts on behalf of the company.

Invoice Discounting allows your business to raise up to 90% of outstanding invoice values immediately similar to Factoring but you remain in complete control of the collection of any outstanding debts from your customers. The invoice discounting facility is completely confidential between your business and the provider and is not disclosed to any other party, giving you peace of mind that your customers will be none the wiser.

The Key Benefits to Invoice Finance

•Immediate access to up to 95% of unpaid invoice values
•Improved cash flow for the business
•Free up working capital to reinvest and grow the business
•Allows you to get on with running the business
•Provides access to credit facilities and credit control management

While the high street banks are restricting financing for business loans and overdrafts, invoice finances two main products – invoice factoring and invoice discounting will continue to fill this cash flow need and ultimately expand or replace the banks role with SME and Corporate business finance.

For more information regarding invoice finance please visit www.sgdfinancial.co.uk