Our Quick Guide to Invoice Finance

Amid the challenging times for businesses, with energy costs on the rise and inflation reaching a high, many will be looking for ways to cut costs and searching for funding help. Whether you’re new to Invoice Finance or looking for a change in product or provider, Invoice Finance can feel a little daunting. With an array of terms, products and providers, we wanted to share our helpful guide into all things Invoice Finance.  

What is Invoice Finance?

Invoice Finance is the general term for finance solutions where money is advanced against the amount due from your customers in the form of invoices. This funding solution grants businesses the certainty of fluid working capital, which can help to improve cashflow, pay employees and suppliers, and invest in growth where they may have previously had to wait. Invoice Factoring and Invoice Discounting are two of the most commonly used forms of Invoice Finance, both allowing businesses access to unpaid invoices.

Invoice Factoring

Invoice Factoring is a flexible solution that advances working capital to a business against outstanding invoices. Factoring allows you access of up to 90% of your unpaid invoices without having to wait 30, 60 or even 90 days for your customer to pay you. With Invoice Factoring, your Invoice Finance provider will look after the credit control process and be responsible for collecting outstanding payments from your customers.

What are the benefits?

  • An increased and more consistent cashflow, allowing the certainty of working capital.
  • Invoice Factoring can provide your business with up to three times as much working capital compared to a traditional bank overdraft or bank loan without having to use your house as security against it.  
  • You can focus on developing your business without the restraint of late payments.
  • Manage payroll and supplier commitments much more efficiently and effectively.
  • It can relieve the burden of the credit control process as this will be managed by your provider – meaning more time to focus on your business goals!  

Invoice Discounting

Invoice Discounting is another form of Invoice Finance which, like Factoring, allows you access your outstanding invoices without having to wait for customers to pay. Whilst maintaining the benefits of Factoring, Invoice Discounting also allows you to manage the credit control process yourself. This solution is perfect for businesses who prefer to take charge of their credit control process and can be suitable for mature businesses who may already have established processes in place.

How can it support my business?

  • You remain in control of the credit control process and chase your customers for payments.
  • The flexible service we provide will also ensure that your Invoice Discounting solution grows with your business.
  • It is suitable for more established businesses that may already have credit control processes in place.
  • It has the same benefits as Invoice Factoring, meaning you get quick access to funds without waiting for customers to pay.
  • You will have a dedicated Relationship Manager who will be there for support throughout the duration of your facility.  

Our LedgerLite Solution

LedgerLite is a unique Invoice Finance solution from Skipton Business Finance, which grants businesses access to larger proportions of their sales ledger upfront. Simply put, the solution can offer businesses 50% of their monthly sales ledger. The business will send us a copy of their sales ledger once each month and we then make available up to 50% of its value throughout that month. It’s a great option for scaling businesses that may feel they have outgrown their Invoice Finance facility, but do not yet feel ready to be self-funding.  

Why could it be the right solution for my business?

  • A LedgerLite facility can be agreed for 12 months and is a dynamic facility which is based on a company’s current sales ledger, rather than historical balance sheet information.
  • This facility is completely confidential, so customers do not need to know about our involvement.
  • The facility is easy to administer, with quick access to cash.
  • It generates cashflow to pay suppliers and can also be used to assist businesses in turnaround.
  • As with all our Invoice Finance products, each client will have a dedicated Relationship Manager who will deliver our excellent service.
  • LedgerLite does not require management to put up their family homes as security.  

A lender that understands your needs…

Skipton Business Finance is made up of an experienced team of knowledgeable and professional Invoice Finance specialists, who are constantly on hand to meet the needs of each and every business that we work with. Not only this, but our people take the time to know and understand each individual business to ensure that the right solution is chosen for that business, as well as offering on-hand support throughout the facility length. Our Invoice Finance facilities are tailored to each business and can grow and reduce in line with the business’s growth.


Want to know more about how Invoice Finance works and how it could help our business?

Find out more about our Invoice Finance solutions here.Alternatively, get in touch on 0800 085150 or enquire now using our easy to use form.