Do you need to raise money quickly? Are you waiting for invoices to be paid? If so, help is at hand. There are many reputable invoice finance companies on the market that can help you get money owed to you quickly, even if your invoices aren’t overdue. There are two main forms of invoice financing. These are invoice factoring and discounting. Read on if you’ve been wondering “what is invoice financing?”.
Discounting and factoring
In invoice discounting, you borrow money against your invoice, usually between 85-90%. You retain the right to chase your invoice up yourself. Once your invoice is paid off, you can settle you debt to your financier. This option is ideal for any company who does not have the time to chase payment, doesn’t want their client to know they have been working with an invoice finance company and plans to trade further with the company in question. If you’re not worried about the client knowing you’ve used an invoice finance company, your invoice is overdue, or you don’t have the time to pursue payment, you may well be best served by invoice factoring. You may have to pay slightly more for this service, but that’s due to the fact you’ll essentially be using an outsourced collections department.
Weighing up your options
A growing number of companies are raising money quickly via invoice factoring and discounting. Sometimes, waiting any longer for payments to be made is not an option. Maybe you need to pay an invoice yourself, or don’t want to miss out on an investment opportunity. These are just two good reasons to use an invoice finance service. You can usually expect to receive the money you need within just 24 hours. You may wish to speak to a few companies before you decide which one to use.