England – 09/03/2012 -he recession has made many firms turn to invoice finance providers to ease cash flow problems
In the current economic climate, many UK firms are struggling. Even those who are doing well are having huge problems with cash flow. However, those that have access to a good invoice finance service are struggling far less than those who are not yet using this innovative form of financing. A surprising number of UK businesses do not realise that they can be paid money by financiers for their outstanding invoices.
In the 70s and 80s brokers started to offer companies the opportunity to use their outstanding invoices to raise money for their businesses. Unfortunately, they charged high fees and reengaged on some aspect of their agreements, which put many firms off using these services and gave the whole industry a bad name.
Luckily, that has now changed and factoring brokers who carry out these transactions offer a invoice finance service that is as secure as any other financial product. This fact, combined with the fact that borrowing money from banks and other financial institutions has led thousands of businesses to search out and use a invoice finance service.
How an invoice finance service works
Normally if a client owes you £10,000 for a job, you raise an invoice and wait 30 to 55 days to be paid. Using an invoice finance service you can potentially be paid £9,000 of that money within 24 hours of raising your invoice. In other words, up to 90% of the invoice value.
This is possible because a financier effectively buys that invoice from you. They check the credit worthiness of the client who owes you the money and if it is good pay you your money. They do so based on the premise that your client will pay them reliably. When your client pays the invoice, they pay the financier instead of you. At this point, you get paid the outstanding 10% owed minus the financier and brokers fees.
XL Business Finance have been offering a invoice finance service to UK businesses for over a decade and they have seen interest soar. Given that the recession is set to continue, they this trend to continue.
Contact:
XL Business Finance,
Eaton Place Business Centre,
114 Wash way Road, Sale,
Cheshire, UK
M33 7RF
Tel: 0161 980 0577
Fax: 0161 332 6148
Email: info@xlbusinessfinance.co.uk
http://www.xlbusinessfinance.co.uk/
