Invoice Finance Factoring

Invoice Factoring vs Discounting

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Pinnacle Commercial Funding

Factoring Invoices

Business’s across the world have been factoring invoices for many years to boost cash flow. It negates business’s having to wait 30, 60 even 90 days to get paid for work they have already completed. Traditionally when a business completes work for another business, they invoice out on payment credit terms.

What is Invoice Factoring?

Invoice factoring is where a business gets money paid against its invoices to release the capital which is tied up. The invoice financier will typically release up to 90% of the value of the invoice to the business as an up-front payment. For example, if a business had £100,000 of invoices which were owed to them on the sales ledger, the invoice financer could pay them £90,000 as an upfront payment. This allows the business to use the money as cash flow and grow the business as required. Once the invoice is paid the remaining balance will be paid to the business minus the agreed fees. The invoice finance company will collect payment of the invoices and administer credit control. Factoring invoices can be a useful tool to get positive cash-flow and grow a business.

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What Is Turnover?

An invoice finance factoring facility will be partially based on your levels of turnover. This is the amount of invoicing you generate during a pre-determined time frame commonly 12 months. An invoice financier asks you what your current and projected levels of turnover are. Pinnacle as a finance broker will be there too assist you with this if you are unsure or want to know how to work out your turnover levels.

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Want to compare Invoice Financiers?

Do you want to know if you are eligible for invoice factoring or want to compare different financiers to make sure you know you’re getting the best invoice finance facility? Then you’re in the right place! Pinnacle as a finance broker will not only answer any questions you have during the application process but be there throughout your business journey. We have many factoring companies on our panel of lenders all bringing a different approach. Every business is different and that’s why we are there to support you in this.

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Get In Touch To Find Out More

At Pinnacle we are agnostic finance brokers meaning we have no preference or ties to a single lender. This allows you to compare invoice finance facilities and get what is right for your business. This is one of the many benefits of using Pinnacle as your finance broker.

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Pinnacle Invoice Factoring

Who can use Invoice Factoring?

A business has to be invoicing B2B (Business to Business) for work they have completed. Pro-forma invoicing is not suitable for invoice finance. Invoice factoring can be very flexible in who it supports, and a list below names a few industries amongst hundreds of others which are suitable:

 

Recruitment Industry
Construction Industry
Haulage Industry
Courier Industry
Manufacturing
Food and Drink Industry
Printing Industry
Healthcare
Security Industry

 

Factoring can apply for start-up businesses who need business finance. They may already know that cash flow could be difficult for tight. However, generally an invoice financier will want to see a projected or current turnover of £5,000 per month. Pinnacle can support with this if turnover levels are going to be close or less than this. We understand almost every SME business in the UK must secure investment to grow. For larger corporate business’s invoice finance is prevalent due to the nature of the industry such as manufacturing where having positive cash flow is crucial.