Invoice Discounting Frequently Asked Questions
What Is Confidential Invoice Discounting?
It is an arrangement between a Invoice Discounting Company and a business whereby the Invoice Discounting Company provides typically up to 95% cash available against the unpaid invoices of a business “confidentially”. A Invoice Discounting Company also leaves with you routine tasks such as sales ledger management, credit control and credit checking.
Why Won’t The Bank Increase My Overdraft. They Want Me To Use Confidential Invoice Discounting?
Because debtors are often the most appropriate asset to provide security for working capital through Invoice Discounting. The Bank is not able to control debtor risk and you need flexibility to develop your business to its full potential. Confidential Invoice Discounting are ways to increase your working capital and allow your company to grow.
Why Confidential Invoice Discounting?
Invoice Discounting provides greater security over a debtor book, that’s all they do quite often “Confidentially”. Consequently it is probable that more working capital will be available by an Invoice Discounting Company using your debtor book as security. Confidential Invoice Discounting funding is more able to keep pace with your sales growth and will give you more flexibility. The other benefits of Invoice Discounting it will enable you to develop a successful business safely and give the business competitive advantages.
Debt Collectors Will Upset My Customers?
No! You run your own sales ledger. The Confidential Invoice Discounting Company does not get involved.
Isn’t Confidential Invoice Discounting Expensive Though?
Not if it helps you increase profits. Invoice Discounting funds will be very similar in cost to Bank overdraft. The Invoice Discounting service fee must be viewed against the savings that can be made and the ability to increase income. Obtain better terms from suppliers for early settlement. Discontinue early settlement discount to debtors. Release management time from managing cashflow to increasing sales. Ability to grow quickly/safely
Exactly How Much Will Invoice Discounting Cost?
Invoice Discounting money costs will be very similar to overdraft. Invoice Discounting service fee will depend upon the type of facility we will be able to give you an accurate Invoice Discounting price indication tailored to your business requirements.
Will My Customer/Suppliers Think I Am Going Bust If I Use Invoice Discounting?
Not nowadays. The service is also Confidential so only you, your Company and your Confidential Invoice Discounter Company should be aware
What Type Of Receivable Is Acceptable To A Invoice Discounting Company?
Any valid invoice for services already performed that has not been pledged to another entity will be usually acceptable to Invoice Discounting Companies.
Are Government Receivables Acceptable To Invoice Discounting Companies?
Yes! Albeit the Crown Right off set-off applies to Government debt. Contact us and we will access your businesses position and which Invoice Discounting Company will be able to assist you most successfully.
Is The Invoice On The Confidential Invoice Discounting Companies Letterhead Or Yours?
Yours, the service is completely confidential.
What Will My Customers Think If I StartConfidential Invoice Discounting?
Invoice Discounting is used by many of the largest Companies in the world to improve cash flow, support growth, and increase profits. Many of your customers may use Invoice Discounting themselves and others have become familiar with it through other vendors. The fact that you qualify for this Invoice Discounting “credit line” makes a strong positive statement. Invoice Discounting Companies are here to help you grow and become even more successful
What Is Required Before Invoice Discounting An Invoice?
The work/goods must have been completed, delivered and accepted; and your customer must be a creditworthy risk.
Can We Qualify For Invoice Discounting If We Have A History Of Credit Problems Such As Bankruptcy,
Yes! Different Invoice Discounting Companies have different lending criteria. We can help you find the right Invoice Discounting Company to fit your circumstances.
How Do Invoice Discounting Requirements Compare To Factoring?
Unlike Factoring requirements, Invoice Discounting does not require the Factoring Company to run your sales ledger. They like customers to have their own staffed accounts and collections department.
How Quickly Can I Expect To Receive My Money From A Invoice Discounting Company?
Once an account has been established by the Invoice Discounting Company, you can receive cash advances usually within 24 hours on an approved credit risk. This is usually done online.
Can We Qualify For Invoice Discounting If We Already Have Existing Credit Lines Or Loans?
Can We Qualify Even If We Are Just Starting In Business And Have No Credit History?
Yes, if you have creditworthy customers
How Do You Make Money?
We get paid a commission if we successfully place you.
What Happens If My Customer Does Not Pay The Invoice Discounting Company?
Non-recourse Invoice Discounting, assumes the risk of your customer not being financially able to pay for the services provided. However, the Invoice Discounting Company would not assume the risk of non-payment due to disputes regarding quality or timeliness of goods or services. Recourse Invoice Discounting you would assume the risk.
Are There Any Geographical Restrictions To Your Service?
No we are truly a UK nationwide service
Will Invoice Discounting Be Good For My Business?
Yes, as long as you wisely use the additional time and cash derived from Invoice Discounting. Invoice Discounting can be quite beneficial if you use it as a means to increase your sales, improve your credit, take advantage of early payment discounts or focus on managing your business.
How Do I Get Started?
It’s simple. Call us or complete get a Invoice Discounting quote. We will contact you promptly to discuss the next step.
What Advance Can I Get Against My Ledger?
Up to 90% is typical of the value of each of your invoices, immediately they are raised and accepted by the Invoice Discounting Company. The percentage of invoices available to you is agreed in advance by the Invoice Discounting Company, based on the creditworthiness of your customer base, so you know how much cash will be instantly available. Naturally, the balance of your sales invoices is made available as soon as your customers pay by the Confidential Invoice Discounting Company.
What Is Confidential Invoice Discounting?
It is an arrangement between a Confidential Invoice Discounting Company and a business whereby the factor provides between 75% and 95% cash available against the unpaid invoices of a business.
How Can It Help My Business?
Confidential Invoice Discounting can create immediate extra working capital, by advancing cash either the same or the following day against invoices the Invoice Discounting Company receives. Confidential Invoice Discounting also allows the client to concentrate on sales and production functions as the Confidential Invoice Discounting Company takes care of the credit control process.
Why Would I Need Confidential Invoice Discounting?
If your business has inappropriate or inadequate financial facilities, a rapidly growing order book, high stock hold requirement or suffers from late payment from debtors, Confidential Invoice Discounting could meet your cashflow requirements.
What Is The Difference Between Confidential Invoice Discounting And Invoice Discounting?
Both facilities provide immediate cash against invoices. Confidential Invoice Discounting is generally a confidential facility, so only you, your Banker and the Confidential Invoice Discounting Company are know its happening. A Invoice Discounting facility provides a full sales ledger and dependent upon your requirements can be disclosed to your customers. Generally its up to you.
What Is The Difference Between Recourse And Non-Recourse Invoice Discounting?
Confidential Invoice Discounting clients can protect themselves against bad debts with a non-recourse Confidential Invoice Discounting arrangement. The Invoice Discounting Company will cover the client for bad debt losses up to an agreed limit for each customer. With recourse Confidential Invoice Discounting any bad debt is the responsibility of the client. Naturally there is an additional cost to the client for non-recourse Confidential Invoice Discounting.
Are Any Types Of Businesses Unsuitable For Invoice Discounting?
Invoice Discounting can be used for a wide range of businesses offering goods or services on credit terms. However, some types of businesses such as those involved in stage payments or long term contracts, as in the building industry, are unsuitable for Invoice Discounting. Contact is and we can talk you though the options
What Criteria Must My Business Satisfy To Be Funded By Confidential Invoice Discounting?
Confidential Invoice Discounting Companies will require a minimum turnover level per annum but there is usually no upper limit. Start up businesses will be considered if they have a satisfactory business plan.
What Security Is Required?
Generally a Confidential Invoice Discounting agreement between the client and the Invoice Discounting Company covering purchase of debts by the Confidential Invoice Discounting Company, in addition to personal guarantees/performance warranties is all that will be required. Occasionally a debenture over book debts or guarantees from associate/parent Companies will be necessary.
Can I Retain My Banking Facilities If We Use Confidential Invoice Discounting?
Yes. Confidential Invoice Discounting does not disturb an existing Banking relationship. However, it is likely that any existing Bank overdraft facility will be reduced on the commencement of a Invoice Discounting relationship but the reduction will be more than compensated by the additional cash made available against invoices by the Confidential Invoice Discounting facility.
How Can I Keep Up To Date With Daily Changes On My Sales Ledger?
Daily transactions are advised on paper and most Confidential Invoice Discounting Companies provide a direct link between the Invoice Discounting Company and the client who can view their own sales ledger movements as they happen. Any disputes are also notified to clients immediately by the Confidential Invoice Discounting Company.
Can You Confidential Invoice Discounting Export Sales?
Yes certainly, although some high risk countries must be excluded
What Benefits Will Invoice Discounting Provide For The Future Prosperity Of My Business?
Invoice Discounting provides immediate working capital, helps to solve cashflow problems, provides headroom for growth and frees up valuable management time to enable a business to maximise its full potential and enhances ownership value.
Are There Many Providers Of Confidential Invoice Discounting Services?
Yes. Well over 80 Invoice Discounting Companies in the UK.
How Do I Choose The Right Confidential Invoice Discounting Facility?
We will help you. Please call our service is free.
How Can Invoice Discounting Help My Business?
Invoice Discounting can create immediate extra working capital, by advancing cash either the same or the following day against invoices. Invoice Discounting also allows the client to concentrate on sales and production functions as the Invoice Discounting Company takes care of the credit control process.
Why Would I Need Invoice Discounting?
If your business has inappropriate or inadequate financial facilities, a rapidly growing order book or suffers from late payment from debtors, Confidential Invoice Discounting could meet your cashflow requirements. A Invoice Discounting Facility grows with you.
What Is The Difference Between Recourse And Non-Recourse Confidential Invoice Discounting?
Confidential Invoice Discounting clients can protect themselves against bad debts with a non-recourse Confidential Invoice Discounting arrangement. The Confidential Invoice Discounting Company will cover the client for bad debt losses up to an agreed limit for each customer. With recourse Confidential Invoice Discounting any bad debt is the responsibility of the client. Naturally there is an additional cost to the client for non-recourse Confidential Invoice Discounting.
Are Any Types Of Businesses Unsuitable For Confidential Invoice Discounting?
Yes. Confidential Invoice Discounting can be used for a wide range of businesses offering goods or services on credit terms. However, some types of businesses such as those involved in stage payments or long-term contracts, as in the building industry, are sometimes unsuitable for Confidential Invoice Discounting.
What Criteria Must My Business Satisfy To Be Funded By Invoice Discounting Business?
Confidential Invoice Discounting Companies will require a minimum turnover but there is usually no upper limit. Start up businesses will be considered by Confidential Invoice Discounting Companies if they have a satisfactory business plan.
Are There Many Providers Of Confidential Invoice Discounting, Invoice Discounting Services?
Yes. Well over 80 operating in the UK.
How Do I Choose The Right Confidential Invoice Discounting Company For My Needs?
We can assist you. Our service is Free of charge