Invoice Finance Review: Are You Paying Too Much?
If you already use invoice finance but have not reviewed your facility recently, you could be paying too much, receiving less funding than your ledger can support or remaining tied to terms that no longer suit your business. Your turnover, customers and funding requirements change. Your invoice finance facility should change with them.
Could You Be Paying Too Much?
Invoice finance costs can include a service fee, discount charge, minimum annual fee, audit costs and other charges. The headline percentage does not always show the complete annual cost.
A review should compare what you pay with the amount of usable funding, service and flexibility you receive. Go-Factor can calculate the true cost of your existing facility and compare it with current market options.
Could You Release More Cash?
The facility limit is not always the amount available to draw. Advance rates, customer limits, concentration restrictions, reserves and invoice eligibility can all reduce usable funding.
Go-Factor can identify what is restricting your current availability and compare providers offering stronger customer limits, advance rates or concentration terms.
Do You Still Need to Fund Every Customer?
Your current whole-turnover facility may no longer reflect how you use funding. If only certain customers create cash-flow pressure, selective debtor finance could allow you to fund chosen customer accounts rather than the complete sales ledger.
If funding is needed only occasionally, single-invoice finance can release cash from one selected invoice without an ongoing whole-turnover facility.
Go-Factor will compare the real cost and flexibility of these options with your existing arrangement.
What Could an Invoice Finance Review Improve?
- Lower service fees and funding costs.
- A higher advance rate.
- Stronger customer and concentration limits.
- More usable cash from the existing sales ledger.
- Lower or removed minimum fees.
- Shorter and more flexible contract terms.
- Confidential invoice discounting.
- Selective debtor or single-invoice funding.
- Better service and sector knowledge.
Do I Have to Switch Providers?
No. A review can strengthen negotiations with your existing provider as well as identify better alternatives.
If your current provider can improve the funding, pricing and terms, remaining in place may produce the right result. If it cannot, Go-Factor can compare alternative providers and manage the transfer.
Read: Can I Switch Invoice Finance Providers?
Should I Approach Every Invoice Finance Provider?
No. Do not flood the market with the same enquiry. Duplicate approaches can waste your time, create conflicting information and trigger unnecessary calls and searches. They may also prevent Go-Factor from using parts of its panel where a provider has already recorded the first direct approach or introduction.
Speak to Go-Factor first. We will review your existing facility, present the opportunity properly, create competition and approach only providers that genuinely fit your business.
Go-Factor insight: The cheapest headline rate is not always the best deal. The strongest facility is the one that combines competitive costs with the most usable funding, appropriate customer limits and terms that support how your business trades today.
UK Finance explains how invoice finance releases working capital from unpaid business invoices and outlines the standards applying to its invoice finance and asset-based lending members. Read the UK Finance standards framework .
Learn more about invoice finance for UK businesses .
Review Your Existing Invoice Finance Facility
Go-Factor will review what you are paying, how much usable funding you receive and whether stronger pricing, terms or a more flexible facility are available.
Funding remains subject to invoice eligibility, customer limits, provider assessment, approval and agreed terms.
