There are many good reasons for opting for invoice discounting if you need to unlock the value in unpaid invoices. Invoice financing allows you to raise cash quickly, even when your invoices haven’t been paid. There are two main forms of invoice financing available to you. These are invoice factoring and invoice discounting. With invoice discounting, you borrow money against your invoice, then settle your debt once it has been paid. Discounting could be the right option for you if have a good relationship with your client, you think you will be trading with them again in future, your invoice isn’t overdue but you simply need money now and you don’t mind chasing up the money yourself.
Keep most of what you’re owed
If you don’t expect to trade with your client again, don’t mind them knowing you’ve got a third party involved, don’t have the time or resources to pursue payment or if you’ve been waiting too long to be paid, you may wish to opt for invoice factoring. You may have to pay slightly more for factoring due to the fact you’ll essentially be using an outsourced collections department, but you can expect to keep between 85-90% of what you’re owed after the financier has taken their cut whichever option you choose.
Boost your cash flow
Companies from various sectors are now looking at invoice financing when they need to raise money quickly. Invoice financing can help you settle your own debts, improve your cash flow and give you the cash you need to take advantage of exceptional investment opportunities. It could be better to speak to a number of invoice finance companies to see what they have to offer before you decide which firm to work with. Invoice finance can give you the breathing space you need.