We think so but then again why wouldn’t we ! As an independent business finance specialist we are firm believers that borrowings should be spread across as many financial institutions as possible. We also believe that any form of invoice discounting is better than a bank overdraft.
The problem with a bank overdraft means that you are at the beck and call of the bank. An overdraft is repayable on demand and at the first sign of trouble it can be withdrawn at a moments notice. No one ever thinks this will happen but believe you me, we have seen it happen and the consequences are not pretty. Another problem with bank overdrafts is that the amount you can borrow is determined by the strength of your balance sheet or the level of security available. Bank overdrafts of any significant amount are normally secured against bricks and mortar.
Invoice discounting couldn’t be different. A facility is secured against your unpaid invoices and within reason as your business expands so does the size of the facility available. Providing you are looking for standard trading terms borrowings of 80% of debtor book are the norm without the need to provide additional security.
Directors warranties are the normal comfort obtained from the invoice discounting company which provides an indemnity against any fraudulent activity. Fair enough one thinks
XL Business Finance has been helping the SME market for over 10 years sourcing the right kind of funding for a business’s particular needs. Give us a call today to see how we can help you
