What is a Factoring Broker?

What is a Factoring Broker?

A factoring broker is either a person or a business which helps a company considering factoring its invoices find an appropriate factoring facility based on the needs and requirements of the business. Please note that the factoring broker merely acts as an agent to find a factor that will accept the accounts receivable or invoices into a factoring facility.

In the UK most factoring brokers offer independent advice and expertise to find customers the best deal. A good factoring broker speaks to potential clients, visits their premises and carries out an audit of the customers invoices to see if factoring is beneficial.

Advantages of using a Factoring broker

The benefits of using a factoring broker are:-

  • A broker will invest significant time in getting to know the business looking for factoring and provide best advice.
  • A factoring broker compare different factoring companies and gives the customer a choice of several factoring companies.

Factoring Broker regulation

The Asset Based Finance Association (ABFA) formerly known as the FDA, is a UK based trade association representing an industry with forty years experience of supplying much needed liquidity to UK businesses. The members provide Factoring, Invoice Discounting and Asset Based Lending.

Finding an Independent factoring broker

A truly independent factoring broker will search the whole factoring market and provide a list of suitable factoring companies.

In the UK some factoring broker firms claim to be independent even know they are owned by a factoring company. If this is the case a factoring broker should state they offering independent advice and detail their links to particular factoring companies.

Factoring Broker types in the UK

A good factoring broker should search the entire market and be able to explain the advantages and disadvantages of each factoring company in the context of the company of business looking for factoring.

  • An Insolvency Practitioners often can work as factoring broker
  • A lawyer often can work as factoring broker
  • An accountant often can work as factoring broker
  • A specialist business advice firm can work as factoring broker
  • A commercial finance firm can work as factoring broker
  • An asset based lending form can work as factoring broker
  • An bank can act as factoring broker

The factoringhelpline.co.uk broker gets paid fees by the factoring company and so you, the client are not charged for the advice. Please call 0800 597 4757 to speak to a factoring broker for advice today.

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