A2B Invoice Financing And Discounting
Invoice financing offers a simple and effective means of accessing the funds from customer invoices. The process starts with you raising an invoice for products or services, as usual. A copy of the invoice is sent to the lender and they provide you with a percentage of the invoice total (usually around 85%).
Once your customer makes full payment of the invoice you receive the remaining balance, after the lender’s fee has been taken. We can provide access to lenders that provide a discounting service, which means that ours and the lender’s involvement remains totally anonymous, or you can let the lender manage the full invoicing and payment collection process. With a full management service, all you have to do is raise an invoice and collect funds directly from the lender.
Invoice discounting can be made entirely anonymous. Provide a copy of your invoice, and your lender provides you with the majority of the funds attributed to that invoice. Your customer makes payment to an account held by the lender, but in your name. As far as the customers are aware, nobody else is involved in the process and you can retain your relationship with them.
Alternatively, if you don’t want the hassle of collecting money and making payment, the lender can take over the management of payments. You still raise an invoice as normal, but you provide account details provided by the lender. They chase the invoice and ensure that the total is paid on time. Once payment is made, they release the remaining funds to you.
Improve Business Cash Flow
The greatest benefit of invoice financing is that it allows you to free up cash. Sums that would normally take weeks or months to clear are available within a couple of days of invoicing the customer. It means that you can use money from your invoices to outsource, to pay for growth and expansion, or to ensure that you have a positive cashflow throughout the invoicing period.
No Assets Needed
You don’t need to own any assets to benefit from invoice financing. Whereas a secured loan or other form of credit might require the use of property or equipment as capital, all you need for invoice factoring are customers and invoices. It also means that businesses without any physical assets can effectively borrow money.
Improve Cashflow Without Risking Assets
Even if credit is available to you, it may be severely limited. Unless you have assets, banks and lenders will be unwilling to lend large sums of money unless you have an extensive and strong financial history. The decision is based on risk and potential returns. High street lenders, especially, are reluctant to lend money unless they have the security of property or other assets. This isn’t necessary with invoice financing. If you have limited assets, invoice financing can provide you with a bigger line of credit.
Invoice discounting can be kept anonymous. There is no reason for your customers to know that we or the lenders are involved in the process at all. Some businesses don’t want clients knowing that they use a third-party invoice financing company.
Our aim, at A2B Finance, is to provide businesses like yours with access to the finance and credit that they need to be able to survive and thrive. Invoice financing is a safe option, because you cannot borrow more than your cashflow allows. Call us today to discuss your financing options, and to determine which is the most beneficial for you.