What is single invoice discounting?

What is single invoice discounting?

The concept of single Invoice Discounting is relatively new and there are only a handful of factoring firms operating in this niche market. Single invoice discounting is a solution that all companies can consider. Please note that single invoice discounting is different to factoring as it is the purchase of an individual invoice only.

What is single invoice discounting?

  • Single or selective invoice discounting is often know as “S I D”
  • Single discounting is often know as selective invoice discounting.
  • Single discounting is often know as spot invoice discounting.
  • Single or selective invoice discounting is often know as one-off invoice discounting

What type of business is single invoice discounting best suited for?

  • Business that trade with just one, single customer benefit from single invoice discounting.
  • Single invoice discounting is popular with firms with seasonal trading patterns
  • Those businesses just want finance against one customer only find single invoice discounting an attractive form of invoice finance.
  • Companies who just need finance against one customer for a specific project tend to choose a single invoice discounting arrangement.

The costs of single invoice discounting?

  • The costs of single or selective invoice discounting incurred are more lower as a monthly fee is not required
  • The Single Invoice Discounting charging structure is simple.
  • Single Invoice Discounters do not charge annual administration fees
  • Single Invoice Discounters charge one fee for one invoice.
  • Typically the single invoice discounting companies offers single invoice discounting for a single fee
  • Most single invoice discounting firms initially charge a one-off account setup fee
  • Single invoice discounting firms charge one fee per one invoice.

The advantages of single invoice discounting

  • A single or selective invoice discounting facilities are less intrusive and require less controlling behavior from the invoice finance provider.
  • Single invoice discounters can act very quickly, 48 hours if need be
  • A business can enjoy financial flexibility with single debtor or invoice discounting
  • Most single invoice funding agreements have no lock in contracts.
  • There are no “break fees” when you leave a single invoice funding agreement.
  • Single invoice funding can be used as and when required.
  • Single Invoice discounting can release up to 95% of the invoice value including the single invoice discounting company fee
  • Generally single invoice discounting firms do not come between a business clients and customers.
  • Under a single invoice discounting arrangement a company will remain in control of its own accounts receivable function.

The disadvantages of single invoice discounting

  1. If a business relationship often encounters disputes and queries then single Invoice discounting is best avoided.
  2. As single invoice discounting is expensive it will ultimately mean reduction in your profit margin
  3. If a project is a one-off and single invoice discounting is used the customers may prefer to deal directly with the business.

The UK Factoring Helpline can introduce your business to factoring or invoice discounters who can accommodate single invoices or debtor facilities. Please call 0800 597 4757 for advice for apply online.