When a company sells its invoices, it’s essentially selling the money it’s owed by its customers. This can be a good way to raise capital quickly, since the money from the invoices is typically paid within a month or two.
There are a few things to keep in mind before selling invoices, though. First, make sure that the invoices are for products or services that have already been delivered – you don’t want to sell something that hasn’t been paid for yet!
Second, make sure that the invoices are for a reasonable amount of money. If the invoices are for too small of an amount, you’ll end up losing money on the deal.
Finally, make sure that you’re getting a good interest rate on the invoices. If you’re not, it might be better to just wait and receive the money from the customer directly.
Most business owners are not aware that they can sell their invoices in exchange for immediate payment.
This financial product is knows as invoice finance and can help to ease the cash flow issues of your business.
How to Sell your Unpaid Invoices
The process to sell your unpaid invoices is a simple process, these can be processed through an online platform. All you have to do is upload a copy of the invoice you would like to sell. The lender of your choice will effectively purchase the invoice from you.
Once the unpaid invoices falls due in accordance with the terms and conditions of the invoice, it is also time for your customer to repay the lender. Depending on the size of your business and if you employ in-house credit collection department they are responsible to start chase the outstanding invoice.
Lenders offer a collection service included in the cost if not to collect payment for you. You may choose to collect the payment from your customer yourself. Once your customer has settled the invoice amount with the lender a small balance is also forwarded on to you.
- We do not charge a fee for lender introductions
- Receive cash for invoices
- Raise funds in 24 hours
Can I sell my unpaid invoices?
Yes you can sell unpaid invoices to a third party, by selling your invoices to a third-party namely a factoring company you will realise the full cash amount of the invoice. The buyer of the invoice is known as a factor, they will advance an amount of about 95% against the invoice to you. Once your client has paid the factor, the remaining 5% will be paid to you least any changes the factor has incured.
Companies that buy invoices
Companies that buy invoices are know as a factor. The product that they provide is called invoice factoring or invoice discounting. These companies offer to buy your invoices at a discounted rate.
They will then chase your client for the payment of the invoice at the full rate. The difference between what they purchased the invoice at and the total amount of the invoice is the factors profit.
How to get paid for unpaid invoices
There are a number of ways that you can get paid for unpaid invoice. You maybe looking to sell an individual invoice as opposed to all of the invoices in your outstanding sales ledger, you will want to use spot factoring or single invoice finance. There are a number of lenders who have specialised in offering spot factoring across the UK. We will help you understand which lender best suits your needs through a quick, no-obligation call.
Our expert consultants will discuss your options and explain the process on how to sell your invoices for cash. Should you wish to receive cash for invoices today, click on the Get a Quote button below to get started. Alternatively, you can speak to our team who are available to explain which single invoice finance service may best suit your circumstances.
How quickly can I get funded?
Most clients can get their first batch of factoring unpaid invoices as soon as their account is set up. This set up process should only take a couple of days. However, subsequent invoices can usually be funded on the same day, as long as they can be verified quickly. Verification usually is just a telephone call from the lender to your customer requesting that the work has taken place.
How to qualify?
Qualification is simple for any business looking for invoice finance :
- You must be issuing invoices to another business (business to business payments)
- Credit terms must be stated on the invoice (i.e. 30 days payment terms)
- The invoice must not already be overdue (this maybe considered a bad debt if it goes over your companies credit terms e.g. 60 days overdue)
The above is just an example of criteria, personal credit rating as not needed, and no security unlike with a bank loan or overdraft.
Help with the Selling your Invoices
Our expert consultants will take about 10 minutes to assess what are the best options for you and your business and in which way we can help you sell invoices. We work swiftly and with understand of what type of service you require from a lender.
One of our aims is to secure you some favourable rates with the 2-3 lenders. As leading brokers in this industry we will suggest from our panel of over 20 of the UK’s leading invoice finance providers.
An invoice with credit terms gives due in 30, 60, 90 or even 120 days. This potentially leads to cash flow issues for the supplier. Many businesses in the UK today opt to utilise their accounts receivable and sell unpaid invoice to finance their companies.
What do you mean Sell Invoices?
A sales invoice is an essential and common document used by all kinds of companies. Companies use sales invoices to inform customers of the amount they owe in exchange for goods or services that were sold.
How much does it cost to Sell invoices?
A factoring company may charge 2% for the first 30 days and 0.5% for every 10 days that the invoice remains unpaid. Fees are often referred to as invoice discounting rates.
How do I Sell an Invoice?
You need a funder, we can help you find the best fit lender depending on your needs, your industry, your business size, and expectations.
Seasoned professional with a strong passion for the world of business finance. With over twenty years of dedicated experience in the field, my journey into the world of business finance began with a relentless curiosity for understanding the intricate workings of financial systems.