Services
Working Capital Matters are a Commercial Finance brokerage that specialises in helping UK SME’s source the right Invoice Finance facility.
What is Invoice Finance?
Invoice Finance is a funding solution that enables you to free the cashflow tied up in unpaid invoices. You can receive an initial payment up front, (typically 90% of the gross value of the invoice, up to 100% in some cases) and the remainder when your customer pays the invoice to the Invoice Finance provider – less the service fee. There are a few basic products within Invoice Finance which have their own variations and different ways of working. All have the option of ‘Bad Debt Protection’, also known as Credit Insurance.
Advantages of Invoice Finance
-
Instant access to cash
-
Easy to set up
-
The facility grows with you – as your company gets bigger so does the facility
-
Allows you to pay wages/HMRC/suppliers easier and with less stress
-
Allows you to negotiate better terms with your suppliers
-
Can be confidential so your customers are not aware
-
No trading history required – facilities available for new-start businesses
-
Does not sit on the balance sheet like a loan does
-
Provides peace of mind and security to the running of your business
-
Ideal facility to help your business grow
-
Allows you to gain new customers and earn new orders
-
Could save your business time through outsourcing the credit control leaving more time for you to grow your business
Who is Invoice Finance for?
Invoice Finance is a funding solution for UK businesses that trade business to business and on credit terms. It can be used by new-start businesses or those who have been trading for years.
It can used by companies looking to grow their business, those who are looking to make their day to day life easier as well as those looking to turn their business round and return to profitability. It could also be used to help fund an Acquisition, MBO or MBI too.
How does it work?
1
Invoice your customer as normal
2
Upload your invoice to your funder
3
You will be advanced up to 90% of the invoice value immediately
4
Your customer pays the lender
5
You receive the remaining amount back, minus the service fee
Invoice Factoring
Factoring is a funding solution designed to help improve a business’ working capital. It allows your business to receive instant access to cash from your invoices, rather than waiting for 30-60-90 days to get paid. This allows you to pay suppliers quicker and easier, as well as provide funding to your business to grow and take on new orders and customers.
When using Invoice Finance, you also outsource your credit control functions. This ensures your time is saved from having to chase your customers for unpaid invoices. This allows you to focus on running your business and bringing in new customers.
Invoice factoring can be disclosed or confidential, and you can also have Bad Debt Protection added to the facility giving you peace of mind in case of customer insolvency or protracted customer default.
Advantages of Invoice Factoring
-
Instant access to cash
-
Flexibility of confidential or disclosed
-
Frees up your time to concentrate on running your business
-
Scalable – the facility will grow as your turnover and sales ledger grows
Invoice Discounting
Invoice Discounting is a funding solution that helps your business’ working capital position. It allows your business to release up to 90% of the outstanding invoice value. This frees up the cash for growing your business to meet your day to day demands.
Invoice Discounting is also known as Confidential Invoice Discounting or CID. Like all facilities associated with Invoice Finance, Invoice Discounting allows you to release cash from outstanding invoices. However, this facility remains confidential and your clients do not have to know that you have a facility. Credit control is conducted by your business and a lender’s notice of assignment does not appear on your invoices.
Invoice Discounting is a great solution for companies that already have a strong management and administration team in place and just need the funding.
Advantages of Invoice Discounting
-
Instant access to cash
-
Confidentiality so your customers do not know
-
Provides funding to allow you to grow your business and gain more customers
-
Scalable – the facility will grow as your turnover and sales ledger grows
CHOCCS
CHOCCS – otherwise known as Client Handles Own Credit Control is a funding solution that is a hybrid of Invoice Factoring and Invoice Discounting. The credit control function stays with your business like it would with an Invoice Discounting facility. However, the facility is fully disclosed so the lender’s details can be seen on your invoices, just like they do with an Invoice Factoring facility.
This allows you to maintain more relationships with your clients whilst not having to worry about setting up a Trust Account like you would with a confidential facility. This is quite a common form of funding for your business and allows quite a lot of flexibility for you.
Advantages of CHOCCS
-
Instant access to cash
-
Flexibility of being disclosed but maintaining customer relationships
-
Allows you to expand your business
-
Provides funding to pay suppliers and other outgoings quicker and easier
Construction Finance
Construction Finance is a specialist version of Invoice Finance designed and aimed at companies specifically in the construction sector, where sometimes funding is a lot harder to obtain, but working capital can still be a challenge.
This is a funding solution that allows funding to be provided if there are contracts in place, or where applications for payment, staged payment or retentions feature. It can be used for any purpose, such as purchasing raw materials to fulfil a project, paying wages or ensuring you can meet the day to day demands of the business – bridging the gap between your outgoing payments and your incoming ones.
The majority of Construction Finance facilities are confidential allowing you to receive a working capital injection without your customers knowing of the facility. Like Factoring, credit control support can be added, freeing up your time to concentrate on winning new contracts and running your business.
Advantages of
Construction Finance
-
Instant access to cash
-
Confidentiality so your customers are not aware
-
Outsourced credit control freeing up your time to run your business
-
Gives you the ability to gain new contracts and work on bigger projects
Trade Finance
Trade Finance is a funding solution that enables you to buy more goods from your suppliers and help maintain your cash flow for the business. Whether against confirmed orders from your customer or buying for stock purposes, Trade Finance is an ideal tool to help grow your business.
Trade Finance allows you to fulfil your current orders, as well as accept future orders from your customers, making sure your business is not restricted. It also allows you to trade with more confidence with overseas suppliers and be more flexible with your dealings with customers and suppliers alike. Letters of credit, deposits and full payment can all be utilised to ensure that the purchasing of goods can be made.
Trade Finance is commonly used alongside an Invoice Finance facility, allowing you to take on orders with confidence, knowing that your cash flow is not affected.
Advantages of Trade Finance
-
Provides the business with confidence when making purchases to overseas suppliers
-
Creates flexibility when negotiating rates with your customers and suppliers
-
Allows the business to grow by taking on new orders or increasing stock levels
-
Provides security to the business that cash flow will not be affected
Selective Invoice Finance
Selective Invoice Finance or Spot Factoring is a funding solution that provides a lot of flexibility to you and your business, as it allows you to pick and choose which customers and/or invoices you want funding on. This is compared to traditional Invoice Finance agreements which are whole turnover.
This type of funding provides greater control to you as a business owner as you can decide what levels of funding you need. It is a great solution if your funding requirement is a bit more ad-hoc or hard to predict.
This type of funding can be set up quickly and can be less contractual than traditional Invoice Finance facilities.
Advantages of Invoice Discounting
-
Greater flexibility in your funding to you as a business
-
Provides greater control to you to decide what funding is needed
-
Can be a better match for your funding requirements and business
-
Quick and easy to set up with less contractual requirements