When a business receives an invoice from a supplier or customer, it can opt to have that invoice financed against.
By doing this, the business is taking out a short-term loan, to cover that amount needed. The business must pay the invoice off at the end of the loan term, and the bank then returns it.
In this guide, we cover this process and some of these best invoice financing companies and banks.
Table of Contents:
- Our Top Picks of Best Invoice Financing Firms
- 🧾 1. MarketFinance
- 🧾 2. HSBC
- 🧾 3. Skipton
- 🧾 4. Metro Bank
- 🧾 5. RBS FacFlow
- 🧾 6. Bibby
- 🧾 7. Barclays
- 🧾 8. Aldermore
- 🧾 9. Hitachi Capital
- What is Invoice Financing
- Benefits of Invoice Financing
- Risks of Invoice Financing
- FAQs
Our Top Picks of Best Invoice Financing Firms (UK)
We’ve reviewed some of the internet’s most mission-critical data as efficiently and quickly as possible for this guide. Your best option will boil down to your circumstances. But first:
In a nutshell, the pros & cons of using invoice financing companies:
- The biggest advantage is that it allows businesses to take money against invoices when they don’t have the cash to pay them.
- ⚡ This allows businesses to get paid quickly, when they may not have the cash to pay their suppliers or pay their bills.
- But the disadvantage is that interest rates charged by banks can be very high.
Top Invoice Financing Firms 2023 💳 – Reviews 🇬🇧
1. MarketFinance – Overall Top Invoice Financing Companies: Choice-Pick
MarketFinance is a market-leading provider of invoice finance, working with some of the world's leading businesses.
With over 25 years' experience in the industry, they have a strong track record of providing quality products and services to their customers.
MarketFinance offers a range of invoice financing products, designed to help businesses of all sizes get the funding they need to meet their short-term financing needs. They have a variety of options available, including term loans and line of credit products.
For example, a term loan may be available for as short as one month, and can be up to 90 days in length. A line of credit may be set up for as much as £3 million, and can be as short as 30 days. There are a number of other options available as well, depending on your business needs and budget.
If you're looking for an easy way to get quick and affordable financing for your invoices, then MarketFinance is the perfect option for you. With a close to 100% loan approval rate, they are sure to have the product that meets your needs. So if you're looking for an invoice financing company that you can trust, then look no further.
Overall, MarketFinance offers a range of financing options, including short-term loans, long-term loans, and lease finance. They also offer specialised products for small businesses and start-ups.
PROS
CONS
2. HSBC – Reputable Invoice Financing Companies Pick for all Scales
HSBC is a global banking and financial services company with operations in more than 200 countries and territories.
Founded in 1865, the company is one of the world's oldest and largest banking institutions.
HSBC Invoice Finance offers a range of financing options, including short-term loans, long-term loans, and lease finance. They also offer specialised products for small businesses and start-ups.
You can apply for a loan, or take out a credit facility, online, or via the mobile app. This includes leasing (lease finance is a type of loan in which the equipment (e.g. vehicle) is leased and then either sold on or returned at the end of the lease term). You can choose between one, five, and ten year terms, and the annual percentage rate (APR) you’ll pay will depend on your credit history.
HSBC, who also offer debit and credit card processing for businesses, provides a range of flexible payment plans, and you can choose between a lump sum payment, a monthly payment, or a combination of both. HSBC has a range of products for small businesses and start-ups, including SME finance, which is available for smaller companies.
You can choose between an unsecured loan and a secured loan. Unsecured loans have higher interest rates than secured ones, but they also have lower credit requirements. Lease finance is a type of loan in which the equipment (e.g. vehicle) is leased and then either sold on or returned at the end of the lease term.
Application process
- You can apply for a loan, or take out a credit facility, online, or via the mobile app
- You need to provide your company's name, address, and contact details
- You will need to provide evidence of your company's annual turnover and credit history
PROS
CONS
3. Skipton – Popular Invoice Financing Companies Service for Small Businesses
Skipton Business Finance is a financial services provider based in Skipton, North Yorkshire.
Skipton Bank is a member of the Bank of England and the Irish Banking Federation.
The bank was founded in 1892 and has been providing banking and financial services to businesses in the UK and Ireland for over 100 years. This has ramped up due to the recession and the impact of Covid-19 on UK businesses.
Product Offerings
The company offers a range of products tailored to meet the needs of small businesses. These products include loans, credit facilities, and lease finance. The bank also offers banking and financial services to businesses in the UK and Ireland.
Skipton Business Invoice Financing is a loan product offered by Skipton Business Finance that provides funding for small businesses to pay their invoices. The loan can be used to cover a range of invoice items, including wages, supplies, and other costs associated with running a business. The loan can be repaid over a period of up to 12 months.
Skipton Business Credit is a credit product offered by Skipton Business Finance that provides financing for small businesses to purchase goods or services. The credit can be used to cover a range of purchase items, including wages, supplies, and other costs associated with running a business. The credit can be repaid over a period of up to 12 months.
To be eligible for Skipton Business Credit, a business must have a registered business name and must be based in the UK or Ireland. The credit is not available to businesses that are in liquidation or administration. Other requirements:
- Minimum annual income of £25,000
- Minimum credit score of 660
- Business must be registered with HMRC
- Business must be in good standing with its bank or financial institution
- Business must have a physical address in the UK or Ireland
PROS
CONS
4. Metro Bank – Well-Known Invoice Financing Firms Service for Range of Offerings
Metro Bank is a British bank with over £100 billion in assets. The bank was founded in 1878 and is headquartered in London.
Metro Bank offers a range of products and services to businesses, including loans, credit cards, insurance, and banking services.
In 2018, Metro Bank was ranked as the best bank for small businesses by the independent financial review site Moneyfacts. Moneyfacts awarded Metro Bank five out of five stars for its customer service and its range of products and services.
Overview
Metro Bank offers businesses a range of funding options to help them pay their invoices. These options include short-term loans, long-term loans, and credit cards.
Short-term loans are available in amounts of £1,000 to £25,000. The loan can be repaid over a period of up to 12 months. Long-term loans are available in amounts of £25,000 to £500,000. The loan can be repaid over a period of up to 12 months.
Credit cards are available in amounts of £5,000 to £50,000. The credit card can be used to pay for items related to running a business, such as wages, supplies, and other costs. The credit card can also be used to borrow money against the balance of the card. The credit card can be repaid over a period of up to 12 months.
Metro Bank also offers banking and financial services to businesses in the UK
PROS
CONS
5. RBS FacFlow – Leading Invoice Financing Firms Service for Customer Service
History of RBS FacFlow: Bank RBS FacFlow Bank is a subsidiary of RBS that provides funding to small businesses.
The bank was founded in 2009 and provides financing in the form of short-term loans, long-term loans, and credit cards.
The bank offers financing to businesses in the form of short-term loans, long-term loans, and credit cards.
The loans can be used to finance a variety of items, including wages, supplies, and other costs associated with running a business. The loans can be repaid over a period of up to 12 months.
The customer service at RBS FacFlow Bank is excellent. The staff are knowledgeable and able to provide advice on a variety of financing options. Overall, products and services offered by RBS FacFlow Bank are suitable for small businesses. The bank offers a wide range of financing options, as well as a variety of products and services related to running a business.
PROS
CONS
6. Bibby – Popular Invoice Financing Companies Choice Service for Startups
Bibby Financial Services Bank was founded in 1865. The bank is based in the United Kingdom and offers a range of financial products and services to businesses.
Overall, the customer service at Bibby Financial Services Bank is reportedly top-notch. The staff are experienced and able to provide advice on a variety of financing options.
The products and services offered by Bibby Financial Services Bank are suitable for small businesses. The bank offers a wide range of financing options, as well as a variety of products and services related to running a business.
Bibby Invoice Financing Overview
Bibby Invoice Financing is a financing option that lets businesses receive cash advances against invoices. This allows businesses to meet their financial obligations quickly and easily. Bibby.com offers a wide range of invoice financing options to suit a variety of needs. For example, one option can be used to bridge a cash flow issue, such as paying a supplier or customer when the company does not have the money to do so.
Bibby Financial Services Bank has a good credit rating. This means that the bank is likely to be able to provide financing products and services to businesses of all sizes.
PROS
CONS
7. Barclays – Well-Established Invoice Financing Companies Service for Security
Barclays is a British bank with over 200 years of history. The bank offers a variety of financing products and services to businesses of all sizes.
Barclays has a good credit rating, so businesses can be confident that the bank will be able to provide them with the financing they need.
Barclays Invoice Financing Overview
Barclays offers a variety of financing products and services to businesses. These products and services include invoice financing, which is a type of short-term credit that businesses can use to pay their suppliers or customers.
How Barclays Invoice Financing Works
Businesses can use Barclays invoice financing to pay their suppliers or customers. Barclays will approve the payment, and the money will be transferred from the business's account to the supplier or customer's account immediately.
When the invoice is due, the funds can be transferred back to the business's account, and the process starts again. Once this happens frequently, the business can see a significant increase in its cash flow. Once the invoice is paid, it is out of the supplier's or customer's system, so they will not have to worry about late payments or owing them money.
Benefits of Using Barclays Invoice Financing
If you choose to go into debt rather than saving cash, there are a number of benefits to using Barclays invoice financing, including:
- It's easy to use. Businesses can get started quickly by filling out a simple application form.
- It's competitively-priced. Barclays offers a variety of financing options that are tailored to meet the needs of different businesses.
- It's secure. Barclays provides customers with credit protection and insurance coverage, so they can be sure that their money is safe.
There are a few eligibility requirements that need to be met before applying for Barclays invoice financing. The first is that the business needs to be registered with Barclays. This can be done by visiting their website or by calling customer service.
Once registered, the business will need to have an active account with Barclays in order to apply for financing. This can be verified by visiting the account overview page on the bank's website. Finally, the business must have an invoice that can be used as proof of purchase or services rendered.
This can be a purchase order, receipt, or any other document that proves that the money being requested is for goods or services purchased from the supplier or customer.
PROS
CONS
8. Aldermore – Top Invoice Financing Companies Service for Credit Protection
Aldermore Bank was founded in 1844 and is headquartered in London, England. The bank offers a variety of products and services, including invoice finance.
Eligibility requirements: To apply for Aldermore invoice finance, the business must be registered with the bank and have an active account with the bank. The business must also have an invoice to use as proof of purchase or services rendered.
Aldermore Bank Invoice Financing Overview
Aldermore offers a variety of financing options, including short-term and long-term loans. The short-term loans are available in two repayment periods, with a six-month grace period between instalments.
The long-term loans are available in three repayment periods, with a 12-month grace period between instalments. Both the short-term and long-term loans have fixed interest rates. The bank also offers credit protection and insurance coverage for the business.
PROS
CONS
9. Hitachi Capital (now Novuna) – Trusted Top Invoice Financing Companies Service for Speed and Clarity
Lastly, Hitachi Capital Bank was founded in 1984 and is based in Tokyo, Japan. The bank offers a variety of banking products and services to businesses in Japan and around the world.
Hitachi Capital Bank is a subsidiary of Hitachi Corporation.
Hitachi Capital Bank invoice Financing Overview
Hitachi Capital Bank offers invoice financing to businesses in Japan and around the world. The bank offers a variety of terms, including short-term and long-term loans. The interest rates on the loans are fixed and are based on the bank's lending rate index. The bank also offers credit protection and insurance coverage for the business.
Rates and Terms
Hitachi Capital Bank offers a variety of terms, including short-term and long-term loans. The interest rates on the loans are fixed and are based on the bank's lending rate index. The bank also offers credit protection and insurance coverage for the business.
Repayment periods
Hitachi Capital Bank offers a 12-month grace period between instalments on its loans.
PROS
CONS
Buying Guide
Before you go with one of our favourite invoice financing providers from the above review, let’s go over more background details. This section is handy for increasing your awareness on this topic.
What is Invoice Financing?
Invoice financing is a form of financing that takes place when a business sells an item to another business on an invoice.
The seller writes the value of the item on the invoice, and then sells the invoice to the buyer for the amount of the invoice.
This gives the seller access to financing from the buyer’s business. The seller then pays the invoice amount back to the buyer’s business at the end of the seller’s terms. Invoice financing is also known as account credit, account financing, or, less commonly, as purchase order financing. In fact, the purchase order is just a form of invoice.
History of Invoice Financing
The earliest form of invoice financing was probably the loan sharking business.
Loan sharks would give small businesses a short-term loan in order to buy goods on credit. The small businesses would then be forced to pay back the loan with interest, and they would have to sell their products on credit in order to repay the loan. This type of business financing is still used today, but it is usually done through commercial banks or other financial institutions.
The modern form of invoice financing originated in the late 1960s and early 1970s. At this time, large companies began issuing purchase orders to smaller companies in order to purchase large quantities of goods at one time. Purchase orders are just like regular invoices, except that they are issued by a company instead of by an individual seller. Purchase orders are usually used when a company wants to buy goods from multiple suppliers at once.
Benefits of Invoice Financing
If you decide to go into debt rather than becoming a creditor, there are arguably some benefits to using invoice financing for your business:
☑️ First of all, invoice financing is a quick and easy way to get access to money. You can usually get a loan from a bank or other financial institution within minutes of submitting an invoice request. And since you don’t have to borrow money from several different sources, invoice financing is often much cheaper than traditional forms of business financing.
☑️ Another arguable benefit of invoice financing is that it allows you to sell your products on an instalment plan. This means that you can sell your products over time instead of all at once. This can be a great way to build your customer base over time and increase your sales.
☑️ Finally, invoice financing can help you avoid debt defaults. If you use invoice financing to finance your business purchases, you will have to pay back the loan with interest. This means that you will have to make sure that you can repay the loan in a timely manner if you want to keep the loan. By avoiding debt defaults, invoice financing can help protect your business from potential financial problems down the road.
☑️ You can get access to financing to help you purchase expensive items or expand your business. This can include obtaining a loan from a bank or applying for a grant from the government. Access to financing can be difficult to obtain, so be sure to compare the costs of various options and shop around. It’s also a good idea to reach out to a mentor or trusted advisor to get more information on how to get financing.
☑️ You can get cash quickly and easily through invoice financing. Invoice financing is a quick, easy way to get money when you need it fast. It is a transaction where a buyer purchases a service or product and then pays for it at a later date. You can receive the money quickly, and then bill the buyer when they pay. This option is a great way to handle cash flow issues, and it is also a form of asset financing.
☑️ With Invoice financing, the seller doesn’t need to have a good credit score, as the buyer will pay the invoice amount back to the seller’s business. The buyer is protected by a security agreement, which means that the buyer can get reimbursement if anything goes wrong with the purchase.
Other benefits include:
- Can Be Used For Renewal - Invoice financing can be used again and again for renewal.
- Working Capital Financing - Working capital financing allows you to bring in cash to fund operations. This is a critical type of funding if you want to stay in business.
- Large Purchases - You can use this method to finance large purchases, such as when you buy a new machine.
- Pay Off Loans - If you have a loan in place or are seeking to pay off a loan, invoice financing can be a good option.
- Debt Reduction - Finally, invoice financing can be used as a way to reduce your overall debt.
Risks of Invoice Financing
If you don't have a good credit score, you may not be able to get approved for invoice financing.
You may have to pay back the money you borrow if you can't repay the debt on time.
Keep track of your debts, keep credit cards and other loans in good standing, and be aware of the consequences of getting into debt. If you're unable to repay a debt, talk to a credit counsellor or financial advisor. They can help you explore your options and find a solution.
Consequences of getting into debt can quickly snowball. If you're not proactive about managing your debts, they can quickly become unmanageable.
When you have a lot of debt, it can be especially difficult to manage your finances. You have to deal with your debt each month, and you know how hard it can be to stick to a budget when you're feeling stressed about what you owe.
Even if you've been financially responsible up to this point, it's important to have a plan for what will happen if you lose your job or your income decreases.
If you don't have a fall-back position, you could end up in a situation where you can't pay what you owe. You'll likely experience a lot of stress, and that will likely lead to even worse debt management.
Top Invoice Financing Firms 📒 – FAQs
How to Get Invoice Financing?
To get invoice financing, you’ll need to sell your invoices to another business. This other business will then pay you the amount on the invoice. There are two main ways you can do this:
- Sell your invoices on an invoice marketplace, such as www.marketplace.net or www.tradingview.com. You can post your invoices on these marketplaces, and then accept offers to buy your invoices. You’ll earn a small fee for each invoice sold.
- You can also send your invoices to a purchasing department at a company that buys invoices to use as a form of financing.
How to Get Invoice Financing as a Company
If you're the owner of a company seeking invoice financing, here’s what you’ll need to do:
- Create an invoice listing. This will include a detailed description of the items you’re selling and the prices of those items.
- Create sales receipts for all invoices. Make sure you keep these receipts, along with all corresponding payment tickets, because they’ll be required to get the financing.
- Reach out to any companies that buy invoices. Make sure you’re direct and honest with them.
- When the financing deal is done, pay off the invoices that were financed.
Which Company Should You Finance Your Business With?
Although it’s tempting to choose the first company you find selling invoices, that’s not a good idea. Instead, you should choose the company that will offer the financing terms that best fit your business. You can do this by researching a variety of different financing sources, including reading reviews and asking your network of contacts for recommendations.
This will help you find a better fit between the terms of the financing and your business’s needs. And don’t forget to factor in your individual needs, as well. Make sure the company you choose offers good customer service, and make sure you feel comfortable with the company’s terms and conditions.
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