If you’re having trouble with cash flow, is it time to call in CID?
Confidential Invoice Discounting is similar to invoice financing in that it allows a business to borrow against the money it is owed. So if you have sent a customer the bill for work carried out or goods delivered but they are taking their time to pay, you can borrow the majority of the sum until the client settles up. The main difference between Confidential Invoice Discounting and other forms of factoring is that you might not want your customer to know that a third party is involved – hence the confidential element.
Firms need to borrow for all sorts of reasons, but attempts to keep your cash flow moving can be hindered by banks and other traditional lenders. Following the credit crunch, mainstream lenders can seem more reluctant to support businesses, preventing many firms from hitting their targets and achieving their potential.
When you need to unlock funds which are otherwise tied up in sales, Confidential Invoice Discounting allows you to do so. Once you have issued the invoice, a discounting firm can advance you up to 90% of the total, freeing you up to focus on your business. When your client pays, you will receive the remaining balance, minus a small fee. It’s a completely confidential process, allowing you to maintain the trust and rapport you have built up with your customer and not jeopardising future contracts.
Confidential Invoice Discounting is especially useful for manufacturers, wholesalers, transport companies, employment agencies and certain business services. As long as you are UK-based and are not reliant on one or a small number of customers, Confidential Invoice Discounting could be the ideal way to raise capital. And don’t worry that your firm is too big, as it’s is ideal for businesses with a turnover of hundreds of thousands, or even millions, of pounds!
Some asset finance firms have been slow to see the potential of this type of financing, but we work with a range of specialists who understand its strengths. So get in touch with Simply Factoring Brokers on 0333 772 1558 and let us help give your funding a boost – it would be a crime not to!