Invoice Financing UK: A new funding frontier.
Since publicly owned lending companies and conventional banks have ‘red tape’ policies, businesses — small or large — are moving towards alternative lending options for getting overdue invoices and business deals financed. Businesses today may prefer to utilise invoice financing, to help bridge cash flow challenges, therefore accomplishing their goals and objectives.
Effective cash flow management is a vital factor that plays an integral role in business success. In many unpredictable fast paced industries today, businesses need to constantly rotate their money to preserve a healthy cash flow and mitigate the impact that comes with late payments. With invoice financing, SMEs can now avoid taking on debt, adding unnecessary liabilities to their balance sheet or giving up equity in the business, by gaining leverage on an asset they already have: invoices.
Maintaining the right strategic cash flow is essential
Cash flow forecast management can clearly identify the good and the not-so-good aspects of your business’ financial health. Entrepreneurs and companies that are in crucial need of capital and want to maintain an effective cash flow life cycle can benefit from invoice financing, due to its flexibility and involves lower risk than many financing alternatives.
Business owners that have previously adopted funding or capital from traditional sources to sustain the right strategic balance in cash flow now have an option to borrow money against outstanding invoices.
In 2017 to date, companies that utilise invoice financing in the U.K have identified their business’ growth soar significantly. The alternative funding method is becoming an increasingly widespread finance avenue for a variety of entrepreneurial ventures or start-ups. Invoice financing has respectively earned a valuable ranking in finance solutions, and businesses that have both short-term and long-term cash flow crunches can now make an optimal use of invoice purchasing for maintaining steady growth and easily unlocking cash out of their receivables.
Invoice financing options
Invoice finance companies typically offer their services to companies with an annual turnover of at least £50,000, although some will consider start-ups and smaller businesses. A business can typically borrow up to 85% of the value of their invoices. Several different types of providers offer factoring or invoice discounting facilities, including banks, financial institutions, independent providers and online newcomers such as Populous World, which auctions invoices to global investors. The auction process provides invoice sellers with a range of competitive offers and bids around the globe from individual investors.
The Populous World auction model appeals to a multitude of SME’s as it means they can select which customer invoices they would raise finance on, and would only incur fees when they need to use it.
For many companies in the U.K today, invoice financing is paving the way as a new funding frontier, defining itself in the entire global lending market.
Lou Chan, Populous World.
Populous World can fund a company’s individual invoices without having to finance their entire ledger. The team of funding specialists available to help have access to a flexible solution that can meet your company’s needs, and unlock up to 95% of the value of invoices. For more information, visit:
