Welcome to The Credit Agency.co.uk - Invoice Finance Section. This section provides a wealth of information around the area of invoice finance, namely factoring and invoice discounting.
This section is an absolute must read for anyone looking to raise finance against their receivables ledger through invoice discounting services, or invoice factoring.
Email: info@thecreditagency.co.uk
Invoice Finance - Invoice Discounting Services and Accounts Receivable FactoringUsing Invoice Finance can be a great way of funding business growth. Invoice Discounting Services and Factoring Services are the most common methods of raising finance against the accounts receivables ledger, although other variations of these sources of business finance do exist. Factoring and Invoice Discounting are excellent ways of improving working capital for a number of reasons. It can be a cheap source of generating working capital, the level of finance is directly proportionate to business growth, the funding offers the opportunity to remove non-core activities from your business.... and the list goes on! If you are seriously considering Invoice Finance as a method of financing your business, click the 'Factoring' and/or 'Invoice Discounting' links below for a free quotation. You will then be asked to complete a simple online form, but in return you will receive quotes from ALL of the major accounts receivable funders. *These forms cater for new businesses and existing accounts receivable customers alike: RECEIVE AN INVOICE DISCOUNTING QUOTE Accounts receivable factoring and invoice discounting services typically allow your business to raise 80% - 90% of the value of the open items on your sales ledger. Therefore, every time you raise an invoice you are unlocking a further resource of working capital. This resource is generally available to draw down on within 24 hours of the invoice being raised. In order to access this funding your business is required to send a copy of each invoice to the factoring house / invoice discounting company. This can often be carried out electronically. At this point you will also 'assign' the invoices to the funder. This effectively means that the funder retains the right to obtain payment on these invoices in every eventuality. The funding company's risk is therefore held against the invoices themselves. Occasionally, some businesses try to make the funder believe that their invoices have been left 'open' for a longer period of time in order to access a greater level of funding. Obviously this cannot happen in factoring as the factoring service provider manages the credit control of the ledger on your behalf (disclosing the fact that the factoring company is managing the collections). Leaving invoices 'open' is however a possibility with invoice discounting, as you are responsible for managing your own collections. Although this may sound like a good idea in the first instance, it really isn't a clever thing to do. Your invoice discounting service provider will notice that payments are being allocated later than they were previously and will associate a greater level of risk with your account. This can result in the invoice discounter reducing the level of finance available to you as a percentage of your sales ledger, and will also result in an increase in the charges that you pay for the invoice discounting service (not to mention the very real possibility of facing fraud charges) Factoring companies and invoice discounting companies are moving further towards the use of software these days in order to keep up to date with your accounts receivable ledger position. Their software plugs in directly to your accounting software and constantly reports back to the lender on the position of your ledger. You should be mindful of the fact that a well managed ledger will increase the lenders confidence in your business which could then unlock an increased percentage of your sales ledger value becoming available for funding and could also reduce the rates you are charged. Charges for invoice discounting and factoring differ in price due to the levels of service offered. Essentially both have charges made up in the same way, which is in part made up of a service charge based upon the value of the ledger funded and an interest charge on each of the cash advances. A charge which allows for the protection against ad debt is often also available. To find out what level of funding is available to your business and what it will cost, simply click on one/both of the links below and complete the short forms you are presented with. RECEIVE AN INVOICE DISCOUNTING QUOTE More Invoice Finance - Invoice Discounting Services and Accounts Receivable Factoring Information COMING HERE SOON! |
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