Invoice Finance: what is it?

Invoice Finance releases cash tied up in outstanding invoices – allowing the supplier access to money before the customer has paid.

How do Invoice Financing companies help? 

Invoice Finance facilities have become an increasingly popular form of providing short-term cash flow for the business-to-business sector to support business growth.

In today’s economic climate, some companies take full advantage of the repayment terms offered and it can take months for them to settle what they owe. This in turn leaves cash flow strained and suppliers left unpaid.

With Invoice Finance, businesses pay a small percentage of the invoice amount to the lender as a fee for borrowing the money.

It can be a useful tool for SMEs who rely on a regular inflow of cash to operate. It helps to ensure that capital is available to pay wages and bills on time, and that control over the business is maintained.

Why should I consider Invoice Finance?

It can be difficult to find the right lender for your business. Overdrafts have traditionally been the way that most businesses have funded their working capital. However, over the last few years banks have become less willing to offer overdrafts. Instead, they’ve sought to move their customers into an Invoice Finance Facility.

The facility is therefore structured to protect the interests of the bank rather than facilitate the customer’s growth plans.

PMD has access to over 50 invoice financing companies in the Invoice Finance market. Our team takes the time to understand your business to find the right funder to support your growth plans.

If you already have an existing Invoice Finance facility, we can benchmark this against what is available in the market and improve on this by either reducing costs or increasing funding, and in many cases both.

In addition to Invoice Finance, we can help you with:

  • Recovery Loan Scheme: facilitates lending to smaller viable businesses who are unable to get finance from their current lender/bank
  • Credit Insurance: transfers risk away from your business to the insurer in the event of a customer failing to pay trade credit debts due to their business failing
  • Trade Finance: a facility used for international trade. You place the order, and the funder will pay for the goods on your behalf before shipping. You pay them back when they land in the UK or they’re sold on
  • Single Debtor Funding: this is where a funder advances funds against invoices for a single customer rather than your total sales ledger
  • Export Funding: funding against customers who are based overseas
  • Foreign Exchange: the transfer of one currency to another. PMD can help with forward ordering currency, giving you the best rate available

Speak to Mark Millhouse, Head of Invoice Finance, today on 07711 594 030

Mark Millhouse

Mark has worked in commercial finance for 20 years. In 2019, he joined PMD to establish the Invoice Finance division and help diversify their range of facilities and ability to assist in multi asset transactions including MBOs, MBIs, acquisitions and restructures.

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