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Over 50 companies offer factoring or invoice discounting. Which
one is right for you?
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Our associates can get you a good deal quickly by knowing the
invoice discounting market.
You don't pay - the supplier we recommend does. This is the custom
in the industry. You have nothing to lose - if you don't like the
deal, don't take it.
Invoice discounting ... in great demand
UK invoice discounting grew by 609%
between 1995 and 2005.
In 1995 only 13,000 companies in the UK used invoice
finance. By 2006 this had increased to 43,000. Invoice finance products
can grow in line with a business's working capital requirements.
Businesses are no longer restrained by the inflexibility of traditional
funding means. They can utilise the working capital tied up in unpaid
invoices to finance their growth, whilst also taking advantage of
the credit protection offered by invoice financiers as a way to
safeguard future profits.
There are over fifty active providers in the UK
of this specialist invoice finance, each with its own target market
and method of doing things. We at the Banking Liaison Group can
assist with independent guidance as to the marketplace, saving you
time.
A very dynamic marketplace also sees new and established
providers offering something a little different. They can generate
additional cash for businesses alongside the straightforward invoice
financing products. Term loans, stock finance and import finance
are services offered to UK businesses by the invoice financing companies.
These asset based lenders or "smart bankers" are now taking on roles
traditionally handled by the High Street or Merchant Banks.
So what are factoring and
invoice discounting?
How invoice discounting differs from
factoring
Invoice Discounting offers the real cashflow benefits
that factoring offers but without the need to lose control of your
sales ledger and existing methods of credit control. It is usually
a confidential service (known as "C.I.D" - Confidential Invoice
Discounting).
Invoice finance companies usually look for well-established
profitable businesses with an effective and professional sales ledger
administration system, before they are prepared to offer this form
of facility. Generally turnover needs to be running at over £500k
(and with many invoice discounting providers £1m) to qualify.
Service charges (often known as "commission charges")
are usually much lower than for factoring for the obvious reason
that the sales ledger administration is still your responsibility.
Discount Charges vary from case to case but are
usually between 1.25% and 3% over base rate. Often a discounter
will try to match or beat the rate currently being charged by the
client's bankers.
This method of finance is becoming an increasingly
popular method of financing mergers and acquisitions, MBOs and MBIs.
Invoice discounting is becoming increasingly used
alongside stock finance, term loans and trade finance to offer a
full asset based lending package. Many providers of invoice/receivables
finance have brought a new, dynamic and creative set of solutions
to age old problems - often with very attractive cost structures.
Stock finance
Up to 60% advance available against stock or other
unencumbered assets
Level of borrowing and advances linked to Debtors.
This facility is available alongside one of the
debtor finance packages outlined above.
How we can help
Invoice discounting in the UK is an extremely competitive business.
There are many invoice discounting companies, which specialise in
different areas. We can save you a lot of time in your search.
We at the Banking Liaison Group use the services of one of the
UK's best independent specialist consultancies and brokers with
extensive contacts in this industry. We will be glad to help you
identify which invoice financiers will be right for your business.
We make no charge to you for this service, but as recognised and
respected industry specialists we can help you get you the very
best rates and service for your business.
You don't pay us - the invoice discounting company
pays us for the introduction. And you are still getting your good
terms.
Talk to us on 01707 663887 or complete
our form and we will contact you.
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