Invoice Finance In The UK
12 Apr

Why Companies are Choosing Invoice Finance in the UK

What do you do when your bills can’t be paid on time? If you are a small business owner in the UK, you might turn to an invoice finance company for help. 


An invoice finance company, or invoice factoring company, lends money to companies that have been unable to collect the money owed to them by their customers or clients. 

Invoice factoring companies in the UK purchase invoices from businesses at a discount and then collect the full amount owed on those invoices from the debtor businesses or individuals.


What is Invoice Finance?


Invoice finance is a form of financing that allows businesses to finance invoices instead of cash. With invoice finance UK, businesses can get their outstanding invoices paid more quickly, allowing them to access cash flow quicker. 

If you’re looking for invoice finance providers UK, Finance Hub is one of our top-rated companies to help you get your invoices paid faster and free up working capital. They have helped thousands of UK businesses increase their cash flow with short term loans, with no need for collateral or credit checks. 


They will review your application within 24 hours and provide an answer within 72 hours, so there’s no waiting around when you need money fast! 

Finance Hub offers flexible loan options from £5,000 to £20m and repayment terms from 3 months to 36 months. They do not charge any setup fees or hidden costs - it really couldn’t be easier! Contact them for more information.

Reasons why companies choose invoice finance UK?

Firstly, invoice finance UK is a great tool for balancing cash flow. If you’re not familiar with invoice finance it’s essentially when a business borrows money against an invoice that has yet to be paid. When your customers pay their invoices, then you pay back your loan and any accrued interest. 

This gives businesses access to the capital immediately, rather than waiting weeks or months for payment from traditional financial institutions. From a security standpoint, there is no collateral required when taking out an invoice finance loan. 

Because of these factors, many UK companies have found success using invoice finance as a way to boost their cash flow and grow their business. To learn more about how UK invoice finance can help your company, contact a business loan provider in the UK today!


How Can Your Business Benefit From Invoice Financing?

Let’s take a look at how invoice financing works. Essentially, when you sell goods to customers or clients, it can take some time for them to pay you back. This creates an invoice on your end that is owed by your client. 

Then, instead of waiting for payment from that customer, a business invoice finance company buys your invoices and collects them on your behalf. As long as you comply with their terms and conditions, they’ll cover all payments due. 

In return, you’ll receive a portion of those funds upfront. That way, you can focus on growing your business without worrying about collecting money owed to you. For example, let’s say you have $1 million worth of outstanding invoices and you sign up for a 10% advance rate. 

If your UK invoice finance provider pays out $100,000 (10% of $1 million), then you’d have more cash flow available to put toward other expenses like salaries or marketing campaigns. This helps you grow your business faster than if you had to wait for every invoice to be paid before getting any revenue. 

It also means less stress because you don’t have to deal with chasing down late-paying clients—the invoice finance company handles everything for you. 

You might be wondering why businesses would choose such a service over traditional loans. The main reason is that these types of loans come with fewer restrictions than bank loans, which makes them easier to get approved for.

Frequently Asked Questions about UK Invoice Finance

UK businesses often turn to invoice finance as a source of working capital, since they may need to make large upfront payments for inventory and other expenses. Understanding how it works is key to making sure you can make every penny count. 

Here’s some of what you’ll want to know.


How do I choose an invoice finance provider?


You have several different options when choosing an invoice finance provider UK; your decision will depend on your specific needs. For example, if you have a regular flow of invoices coming in each month but don’t require immediate access to cash, then factoring might be best for you. 


However, if you need cash quickly or don’t have enough invoices coming in regularly, then funding or asset-based lending might be better suited to your needs.


What do I need to know before I start using an invoice finance provider?


When a company offers UK invoice finance, it buys your outstanding invoices at a discount. When you have outstanding invoices on which you have not yet been paid, it can be tempting to borrow money from an invoice finance provider. 


However, before you do, there are some things you should know about using these types of services. Remember that although companies make it easy to use their services online, invoice finance is still borrowing money—and any time you borrow money, there’s risk involved.


Where can I find out more about invoice financing?


If you’re a small business owner looking to grow, it can be very difficult to get funding from traditional lenders. However, invoice financing is a great way for businesses of all sizes to secure funding and grow. 


Many different companies offer these services; however, some key factors make one better than another. To learn more about which UK invoice finance company might be right for your business, read our guide above!


Final Thoughts

UK businesses have an average of 26 unpaid invoices at any given time, which can mean missed payments and late fees—and just a general feeling of stress. 

Fortunately, invoice finance is an increasingly popular solution to these concerns, as it allows businesses to grow by using their unpaid invoices as collateral. Find out more about UK invoice finance providers that can help your business today!