Invoice financing companies are available from both independent specialist providers and international banks, but which is right for your business? To get you started in your search we’ve done some of the leg work.
Here are the leading invoice finance providers in the UK today.
HSBC Invoice Finance
When it comes to financial services, HSBC should need no introduction. They’re a worldwide operation with a high level of expertise in almost every financial sector. If you choose HSBC as your invoice funding provider you will be assigned a credit controller who will collect your customer payments and debts for you, while maintaining positive customer relationships on your behalf. However, they also offer invoice discounting for businesses with a turnover of more than £500k enabling them to maintain control of their sales ledger and client relationships.
HSBC offer up to 100% cover which means if a customer cannot pay their debt due to insolvency you will still receive the funds (after 120 days have passed).
You don’t need to bank with HSBC to use their invoice financing services and they are able to help a range of businesses from start-ups and sole traders all the way up to international corporations. There is a minimum contract of 1 year and a 3 month notice period should you wish to exit the contract.
IGF Invoice Financing
IGF is an independent finance provider with 20 years of experience in supporting SMEs with capital solutions. They have a national presence with regional teams to enable them to work closely with businesses and financial advisers.
IGF offer both invoice discounting and factoring and can advance up to 90% of the value of an outstanding invoice within 24 hours.
SME Invoice Finance
SME Invoice Finance aren’t a bank but they specialise in helping UK businesses to unlock their cash flow through either invoice factoring or invoice discounting. The service is only open to B2B companies with a turnover of £100k or more. This includes startups and established businesses.
SME Invoice Finance will fund invoices from £3k – £300m+ and claim that they can do so within 12 hours of an application because of their dedicated funding panel. Most providers stipulate a 24 hour window so this is an impressive claim. Their invoice funding solutions can be tailored to meet your business’ unique needs; they also offer Bad Debt Protection which will ensure you’re protected should any customers be unable to pay you.
Hitachi Capital UK
Hitachi Capital provides a wide range of cash flow solutions to UK businesses including invoice finance. This service is available to both startups and established businesses.
They offer cash forwarding of up to 85% of the invoice amount within 24 hours. Fees of around 1.5% are deducted from the remaining 15%, but this can be as low as 0.5% in some circumstances. They offer a 6 month trial on their service so you can see if the process is of benefit to you and they don’t insist on lengthy contracts. After the initial trial period you will be on a 6 month rolling contract.
They offer both a complete factoring or discounting so, if you prefer, the process can be confidential and your customers will be unaware of any third party involvement, i.e. you would continue to collect customer payments.
Bibby Financial Services
Bibby Financial Services can trace its origins back to 1807 when John Bibby, an entrepreneur, set up his original company in Duke Street, Liverpool. Today, it claims to be the UK’s biggest independent invoice finance provider with 4,500 employees working with over 7,500 UK businesses. They have 18 offices across the UK and advanced over £3billion in 2016 alone.
The size of the operation means they are able to develop relationships with the businesses using the service and help both small and large businesses to achieve their business objectives. This could be in supporting cash flow, new equipment purchase, expansion, overseas trade, management buy ins/buy outs, refinancing, corporate restructuring as well mergers and acquisitions.
Bibby Financial Services include both invoice factoring and confidential invoice discounting and can offer up to 100% of the value of your invoices within 24 hours. They are so confident in their service that if you are not satisfied in the first 3 months they will refund their fees.
Aldermore Invoice Finance
Aldermore Invoice Finance is a relatively new finance provider having only started operating in 2009. They claim that this means they have recent, first hand experience of the challenges modern businesses are facing.
They offer tailored invoice factoring and discounting and offer up to 90% of the value of invoices “straight away” to help you to reinvest in what your business needs. They claim to approve 9/10 applications. To be eligible for invoice finance with Aldermore all you need to be is an organisation that “provides a service or product and raises invoices” but there are certain conditions to be met.
Ashley Business Finance
Ashley Business Finance position themselves as more open minded when it comes deciding who to open their finance solutions to. An independent company with 25 years of expertise in working with SMEs and funding solutions, they suggest that low credit scores do not necessarily exclude your business from being accepted.
To be considered for Ashley Business Finance’s services your business needs to be located in England or Wales, selling on credit terms and business to business only.
RBS Invoice Finance
The Royal Bank of Scotland started in Edinburgh in 1727 but today owns a huge range of brands and banks, some of which are even older than RBS. These include the oldest name in British banking, Child & Co, which dates back to the 1640s and the more recently established Natwest.
To be eligible for RBS Invoice Factoring your business needs to have a turnover between £250k – £6.5m and to use the invoice discounting service you will need a turnover of more than £300k.
RBS provide a facility called FacFlow which enables you to monitor and access your invoice finance status from anywhere in the world.
Skipton Business Finance
As part of the Skipton Building Society Group family, Skipton Business Finance provide SMEs with both invoice factoring and discounting. Their solution can be tailored specifically to your business.
Skipton will advance funds from £25,000 up to £5,000,000 within 24 hours. You will be provided with a dedicated Relationship Manager to support and advise you. They can also carry out free credit reports on your clients if requested.
If your business is a limited company or LLP based in the UK or Ireland and you sell goods or services to other businesses on terms, MarketInvoice Ltd is possible invoice finance provider for you. MarketInvoice Ltd are dedicated to just two services: MarketInvoice Select and MarketInvoice Pro. Both services provide dedicated account manager to advise and support as needed.
MarketInvoice Select is an invoice discounting service which is a pay as you go agreement; you can pick and choose which invoices you would like to be advanced as and when you need to. They will advance up to 90% of the invoice value for anything between £5,000 to £3million. This is suitable for companies with a turnover of over £100,000.
MarketInvoice Pro is a confidential service which will advance up to £4million in funds against your invoices. To use this service you will need to give MarketInvoice Ltd access to your accounts so that they can make funding decisions. To use MarketInvoice Pro you will need to have at least two years of accounts submitted to Companies House (or one year of accounts submitted if you add on Credit Control) and a minimum turnover of £1 million (or over £300,000 turnover with Credit Control).
Metro Bank SME Finance
In 2010 Metro Bank became the first high street bank to open in over 100 years. Their invoice finance service is open to startup businesses and large PLCs but your invoices must be for business to business sales with clean, non-contractual debts i.e. the customer has no ‘get out of paying’ clause such as being dissatisfied with the services provided by you.
They can advance you up to 85% of the invoice within 24 hours. Their fees are “bespoke” but there are 2 types to consider: a service fee and interest on the money advanced. With Metro Bank you are not tied into lengthy contracts as you can exit the agreement with just 28 days notice.
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