Have you delivered goods and/or provided services and are waiting to be paid?
Do you want someone to assist with credit control and reduce the chance of bad debt?
Factoring helps thousands of businesses in the UK confidentially turn unpaid invoices into cash in the bank. It’s a well established method of providing finance that directly grows in proportion to your turnover.
Step 1: You assign your invoices (supported by delivery notes or proof of delivery of goods/services). Many funders now have systems which link with your accounting package to make it quick and easy to use.
Step 2: The funder calculates the amount of cash you can access against the gross invoice value (including VAT), normally calculated on a percentage basis e.g. 80% of a £100,000 gross invoice allows access to £80,000 minus any charges.
Step 3: You request the cash, which can even be done on a same day basis (which may incur a charge), it is paid directly into your normal business bank account.
Step 4: The factor will normally chase the debt on your behalf when it becomes due, helping to minimise the risk of bad debt or unpaid invoices.
Step 5: Once the funder receives the money owed you can access the remaining cash minus the funder’s charges.
Factoring can be a cost-effective solution to funding your business. Special variations include those for exporters or in the construction industry. We specialise in tailoring the correct package to maximise the benefits of factoring.