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Invoice Discounting

Thursday, November 5th, 2009

Invoice discounting is a form of invoice finance providing the financial freedom to grow your business. This form of discounting is usually provided on a confidential basis meaning your customers are unaware that you are using a invoice discounting  company. As such the invoice discounting provides a flexible form of finance enabling a business to release 90% of their unpaid invoices. Recently XL Business Finance has been advising a number of business with turnover in excess of 20m that have been disillusioned with inflexible high street  banking institutions. The good news is that there are a number of specialist lesser known banks specialising in businesses with larger turnover. There are not many institutions capable of handling such large corporate businesses but we have the expertise to matchyou with the most suitable funder.

XL Business Finance regularly introduce invoice discounting to two or three finance companies some of which are foreign owned. These  funders  have been established with the sole purpose of specialising in the UK invoice discounting market. I guarantee you probably haven’t heard of these finance companies however their personnel are of he highest quality and have the ability to structure the most complex of deals. All of our customers have been highly impressed with our recommendations.

Invoice finance

Wednesday, November 4th, 2009

Invoice Finance is still the fastest growng commercial financial product available. The ability to release cash against unpaid invoices can provide the financial freedom which the traditional banking products so often fails to deliver. The good news is that there are still many finance companies offering invoice finance and as such it is relatively easy to obtain funding. Which finance company is best for you depends on the your particular circumstances. XL Business Finance has experience in organising invoice finance for businesses turning over £70k to big PLC  companies with turnover in excess of £30m. We have the expertise and knowledge to help guide you through the manydifferent  options and match you with the most appropriate finance company.

As with any type of finance high street banks try to be all things to all men and in reality don’t often do the job as well as an independent finance company. An independent  invoice finance company is not bank owned and obtains funding from private and independent sources. Therefore an independent invoice finance company tends to be a little bit more flexible and approachable than a high street finance company. However there are certain high street banks that are particularly good in niche areas. For example one high street bank is very good at doing international trade finance whereas another high street bank is very good at doing construction invoice finance. The point is that a good independent factoring broker can save a business time and money by recommending the most appropriate finance company.

Obviously there is other criteria which we take into consideration. The geographic location can be important but not paramount. Te length of time the business has been trading. The profitability of the business. The quality of the debtor book to be funded and whether there is any adverse credit all need to be taken into consideration. And the good part is that our service is totally free of charge. It doesn’t cots you a penny to be put in touch with the most appropriate invoice finance company.

Invoice Finance

Wednesday, October 7th, 2009

Invoice Finance is simply the means of releasing cash against unpaid invoices. Invoice finance takes place in a variety of forms and can include invoice discounting, confidential invoice discounting, factoring, confidential factoring and trade finance. Which ever facility best suits your specific requirements the ability to release additional cash can certainly help a business with their cash flow.

Invoice discounting is simply the means to raise cash against unpaid invoices. It is normally offered on an undisclosed basis. As your customers will be unaware that you discounting your invoices  it is more susceptible to abuse and as such it suits businesses which are financially strong, reputable  and long established. In the current economic climate it is more difficult to get an invoice discounting facility for marginal customers. Costings for such facilities are comparable to a bank overdraft with a a charge over base for borrowing the money plus a small monthly service fee for operating the facility.

As factoring is done on a disclosed basis and your customers will be asked to make payment to the factoring company from the finance companies point of view the product is less risky and as such just about most businesses can obtain a factoring facility. In addition factoring comes with credit control whereby the finance company will chase your debts. This really does add value to product and as such you don’t always get what you pay for. Independent factoring companies tend to be be more proactive than banks factoring companies and as such there may be slight variations in costings.

Invoice Finance

Monday, September 21st, 2009

Businesses wishing to free up cash against unpaid invoices can use Invoice Finance as a means of assisting with cashflow. There are various forms of invoice finance  and which form of finance is best for you  depends on a various circumstances. A good factoring broker will be able to assist with choosing the right company.

Confidential invoice discounting is best suited for businesses which are well established and have a proven track record of being able to collect their invoices. Adequate systems must be in place and any finance company can make an offer subject to an audit. One of our complaints as a broker is  that we see offers  which in reality we know will not come to fruition. We know exactly which finance companies are able to deliver and which ones will fort short on their promises.

A traditional invoice discounting facility will enable a business to submit invoices and they are able to draw cash immediately. It is very much a trust thing going on and as such a business must be well established and trading profitably.  Some finance companies behind the scenes  will  run a mirror ledger unbeknown to their customer to ensure that nothing untoward is going on. Not all finance companies will do this explaining why some finance companies are happy to offer confidential invoice discounting and some finance companies are not.

Invoice Finance

Monday, September 14th, 2009

Invoice finance is simply the means of releasing cash against unpaid invoices. Typically 80% of the invoice is paid upfront by the invoice finance company. On payment of the invoice by your customer ( typically after 90 days)  the remaining 20% is paid to  you less any charges due to the invoice finance company.

An invoice finance facility will unlock cash and assist with a businesses cash flow. Unlike an overdraft facility which is fixed at  a certain amount invoice finance will grow as a business expands . In addition an overdraft facility is repayable on demand and so there is always the risk it could be withdrawn. In recent months we have certainly seen this happen as bankers continue to be nervous and unsupportive in these difficult times. The security that banks require to agree an invoice discouning facility also tends to be more onerous with property often required to secure a facility. An invoice finance facility relies on the unpaid invoices as security. 

Typically a factoring faciltiy  is provided on a disclosed basis and offers a full credit control service. Confidential invoice discounting is normally on an undisclosed  or confidential basis and is just a means of providing cash flow because credit control is kept in house. There are many variations offered by numerous invoice finance facilities and different finance companies have different niche products and attributes. A good invoice discounting broker will be able to advise as to  which funder will be best for your particular needs.

Invoice Finance

Tuesday, September 1st, 2009

Invoice Finance is simply the means of raising cash against unpaid invoices. It is totally a means to raise cash and as a rule has no added value service.

However in the current economic credit crunch the biggest problem customers face is getting decent trade limits against their customers which can have an adverse affect on their cash flow. The biggest source of enquiry is customers complaining of derisory credit limits and asking if there is an alternative available. The truth is that there is very little difference between the funders however it could be argued that a larger independent will provide more flexibility than a high street bank.

We believe the most important aspect in choosing a invoice discounting facility is that a business spreads the risk. Until recently it is so easy to take an invoice discounting facility in conjunction with a small overdraft, even some Hire purchase and maybe a commercial mortgage. Remember a bank is great at giving you an umbrella but soon as it starts raising they want it back. We have recently seen an instance recently whereby a customer went bust. This affected the invoice discounting facility and because it was group banked the overdraft was withdrawn and the business went into administration. This would not have happened if the invoice finance had been separate.


XL Business Finance Ltd is a privately owned and independent business financing company with established links to many of the UK's leading finance houses. XL Business Finance provides a viable alternative to high street banks that lack the flexibility and imagination to provide a solution to most business users requirements. XL Business Finance can provide a full range of business financing solutions and we ensure a high level of customer service and pride ourselves on quick decisions. Our independent status will ensure any offer of funding and asset finance leasing is best suited to our customer’s needs.

XL Business Finance Limited are authorised and regulated by the Financial Conduct Authority FRN 718737).

XL Business Finance, Eaton Place Business Centre, 114 Washway Road, Sale, Cheshire M33 7RF UK.


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