Debtor & invoice finance

You have done the work and issued the invoice. Invoice finance releases most of that value now instead of in ninety days, using the invoice itself as the security.

Who it suits

You invoice other businesses rather than consumers
Payment terms are 30 days or longer
Growth is limited by cash timing, not by demand
Your customers are creditworthy even if you are young

How it works

A lender advances a percentage of an approved invoice, commonly 70 to 90 percent.
Your customer pays on their normal terms, either to you or to a controlled account.
The balance is released to you, less the fee.
The facility grows as your ledger grows, which is the part a term loan cannot do.

What to check before signing

Whether the facility is disclosed to your customers or confidential.
Whether it is whole-ledger or selective. Selective costs more per invoice but you keep control.
Recourse. If your customer never pays, find out now who carries that.
Concentration limits. One customer being most of your ledger changes the pricing.

What we will need

Debtor ledger (aged receivables)

Six months of bank statements

Sample invoices and trading terms

Debt schedule

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