You shouldn’t have to struggle too hard to find help if you need quality invoice financing services. There are many reputable companies on the market who can help you if you are interested in invoice factoring or discounting. The main difference between factoring and discounting is who chases up payment. Discounting involves borrowing money against your invoice until it is settled and remaining in control of pursuing payment. It could be right for you if you have a good relationship with your client, don’t want them to know you’ve used a third-party to get payment, expect to trade with them in future and have the time and resources to chase the money up yourself.
Could factoring be right for me?
Factoring involves selling your invoice to a finance company who then chases up the payment and deals with the client directly. If you don’t mind the client knowing you have used a third-party, don’t have time to chase up the money yourself, doubt the client will be buying your products or services on future or have struggled to get your invoice paid, you may well wish to opt for factoring. You’ll normally get to keep around 85-90% of what your client owes you whatever you decide, although factoring can be slightly more expensive than discounting as you will essentially be using an outsourced collection service.
Reach an educated decision
Many companies are turning to invoice finance companies when they need to unlock the value that’s tied up in invoices quickly. If you are interested in invoice financing, but don’t know which company to use, you may wish to speak to a few different companies so you can weigh up what they have to offer and reach an informed decision.