COMMERCIAL FACTORING FACILITY
Invoice factoring: funding with
professional credit control
Release working capital from unpaid invoices, with support managing your sales ledger and customer collections.
Facility summary
Advance rate
Agreed with the provider
Credit control
Managed by the funder
Customer visibility
Usually disclosed
Turnover requirement
Provider dependent
Bad-debt protection
May be available
WHAT IS INVOICE FACTORING?
Turn unpaid invoices into working capital
Invoice factoring provides funding against eligible business invoices. The provider also manages the sales ledger and collects customer payments, helping with both cash flow and day-to-day credit control.
After supplying goods or completing work, you submit your invoice details to the provider. An agreed advance becomes available, with the remaining balance released after customer payment and agreed charges.
Optional bad-debt protection may be available. Cover is subject to limits and exclusions.
KEY COMMERCIAL ADVANTAGES
Why businesses consider invoice factoring
Support with credit control
The provider manages collections, reducing the day-to-day administration your team handles.
Access working capital sooner
An advance against eligible invoices can help bridge the wait for customer payment.
A clearer view of your ledger
Provider checks and ledger reporting can help you understand customer risk and outstanding balances.
SUITABILITY CHECK
When is factoring the right solution?
Factoring may suit businesses selling on credit terms that need working capital and external support with collections.
✓ Business-to-business invoices on agreed terms
✓ A need to release cash before customers pay
✓ Willingness to involve a provider in collections
✓ A need to release cash before customers pay
✓ Willingness to involve a provider in collections
Providers assess your financial records, sales ledger, customer creditworthiness, overdue balances and disputes.
Sector applications
Explore the practical considerations for your industry.
Prefer to keep collections in-house? Explore invoice discounting.
OPERATIONAL WORKFLOW
The factoring process in four steps
STEP 1
Invoice raised
Deliver the agreed goods or services and submit eligible invoice details to the provider.
STEP 2
Advance released
The provider makes the agreed advance available, subject to checks and facility terms.
STEP 3
Credit control
The provider manages customer collections under the agreed arrangements.
STEP 4
Balance released
After customer payment, the remaining balance is released less agreed charges.
FACTORING ENQUIRIES
Frequently asked questions
about factoring
Customer relationships, credit control and funding terms explained.
The provider manages the sales ledger and collects customer payments. Agree how it will communicate with customers, handle disputes and report progress.
Usually, yes. Customers are normally informed about the provider and payment arrangements. Confirm exactly what they will see before you sign.
With recourse factoring, your business may remain responsible if a customer does not pay. Non-recourse arrangements may include protection for specified risks, subject to limits and exclusions.
The advance level depends on the provider, your business, customers and invoice eligibility. Compare the full written proposal, including charges and contractual commitments.
READY WHEN YOU ARE
Discuss invoice factoring for your business
Tell us a little about your business and what you need from invoice finance. We’ll help you explore the next step.