01Solutions
Invoice finance
Invoice finance is the umbrella term. A provider advances a proportion of the value of eligible invoices, and the balance, less fees, follows when the customer pays.
At a glance
- Funding tracks the sales ledger: as invoicing grows, the available facility may grow with it.
- Facilities are typically structured as either factoring or discounting.
- Providers set their own criteria for which invoices and customers are eligible.
01
How the facility behaves
A business raises an invoice to a customer in the usual way. Under an invoice finance facility, a proportion of that invoice’s value is made available by the provider rather than the business waiting for the customer’s payment terms to run.
When the customer pays, the provider releases the remaining balance, less the agreed fees. The facility then continues to operate against new invoices as they are raised.
Because the funding is linked to invoices rather than to a fixed loan amount, the available capital can move with the sales ledger. That is often the point: growing businesses find that a term loan set last year has little to do with this year’s order book.
02
Two ways to structure it
Most facilities fall into one of two structures. Invoice factoring generally involves the provider supporting or managing credit control, and customers are usually aware of the arrangement. Invoice discounting generally leaves credit control with the business and may operate confidentially, depending on the provider and the structure.
Neither is inherently better. The right structure depends on how the business runs its ledger, how it wants customers to experience it, and what the provider is willing to offer.
03
Where Haslam Consult fits
Haslam Consult is a brokerage. We do not provide the finance ourselves. We help a business understand the requirement, work out which structures are realistic, identify appropriate providers and compare what they offer.
The aim is that when a business speaks to a provider, it already understands the shape of the facility it is discussing.
Typically suits
- Businesses that sell to other businesses on credit terms
- Invoices raised for completed work or delivered goods
- A spread of creditworthy customers rather than one
Worth considering
- Consumer sales and cash-on-delivery businesses are generally outside scope
- Contractual or stage-payment work can be harder to fund and may need specialist providers
- Fees, advance rates and conditions vary between providers and facilities
Providers apply their own eligibility criteria and set their own terms. The points above describe how facilities of this kind commonly operate and are not a guarantee of what any provider will offer.
Other structures
04Next
Start with a conversation.
No application form, no obligation. Tell us about the business and the requirement, and we will tell you honestly whether invoice finance is worth exploring.
What happens when you get in touch
- 01A short conversation about the business, its customers and how it invoices.
- 02We work out whether invoice finance is a realistic fit, and which structure.
- 03If it is, we outline the options and the providers worth approaching. If it is not, we say so.