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My bank wont give me invoice discounting

Business Finance, financing, Manchester, Liverpool, Leeds, London.

Invoice discounting is only one of several invoice finance products available in the market place. Invoice discounting is mainly provided on a confidential basis and as such is commonly known as confidential invoice discounting. How it works is that  a customers will raise an invoice in the usual manner and post a copy to the finance company. the finance company will then make a percentage of the invoice available to the business typically 80%. All this can be viewed on line and different finance companies have slightly different systems and procedures when your customer pays you the finance company is repaid and a small fee is paid to the funder.

As  invoice discounting is quite a trusting way of operating a facility and is very much open to fraud and missuse any finance company requiring an invoice discounting facility  must be squeaky clean, be reasonably profitable, be very established and should have adequate systems and procedures in place. Therefore as most banks, in terms of underwriting, tend to be over cautious in the current climate and will shy  away from offering such facilities. A factoring facility will give the bank more control over the ledger as payments from your customers must be made direct to the invoice discounting company.

The good news is that there are a few alternative finance companies that will take a few. Most finance companies will put a customer on factoring and if they prove themselves then after a period of time they may allow the customer to go to confidential invoice discounting.   A half way house is for the finance company to  leave the credit control with the client however payments are made direct to the finance company. XL Business Finance has helped a number of businesses that have been refused invoice discounting via their banks however we have been able to help by providing a funder that will give the customer a chance on invoice discounting. If it doesn’t work they will put them on factoring.

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