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Stories Tagged ‘Invoice Finance’

Lloyds TSB Commercial Finance have always been aggressive in terms of pricing and also credit appetite when compared to the other bank owned invoice finance providers.

However, recently I have seen their factoring pricing creep up dramatically. In particular the discounting fee. Yesterday I saw a quote where the fee was 4.5% over bank base rate subject to a minimum of 6%. This is 5.5% above the current bank base rate.

Even when compared to the independent providers, many of whom have a higher cost of funds than Lloyds TSB Commercial Finance, this seems expensive to me.

This is fairly disappointing and feels as though the bailed out banking group is taking advantage of SME’s.

I understand they can offer between 3% and 6% so if you are looking for competitive rates be sure to negotiate with Lloyds. Alternatively approach Smart Factoring Quotes and we will source the best rates in the market for you.

Invoice Finance companies will typically not provide finance to companies in the construction industry that raise applications for payment. However, at Funding Solutions we have been finding finance for such companies from the very outset. Clients of ours include scaffolding firms, tiling contractors, roofing contractors and various other construction related businesses. If you are looking for finance against applications for payment then give us a call.

Part of this is because they cannot actually take assignment of an application as it is not a legal document whereas an invoice is.

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Cash Flow Finance

There are a few finance products that can be described as cash flow finance. These are typically invoice discounting, factoring, trade finance and overdraft facilities.

Overdraft facilities secured by way of a debenture have become almost impossible to obtain from banks without additional security. The reason for this relates to a legal case – Natwest v Spectrum Plus Ltd

Factoring and Invoice Discounting are often referred to as invoice finance.  These facilities are readily available to businesses that sell on credit terms to other businesses. Invoice Finance is provided by the high street banks and also an array of independent providers.

Trade Finance typically facilitates imports and exports. It can provide a valuable source of finance but can also protect both customer and supplier as it ensures that funds are released to the supplier but only when the right goods in the right quantity of the right quality are provided at an agreed point.

By combining trade finance and invoice finance if you have a confirmed order from a credit worthy customer you can fund the entire trade cycle right from customer order through to the customer paying.

It is also important to consider how else you can improve cashflow. Solutions include:

  • negotiate with debtors for quicker payment terms
  • effective credit control – can you improve systems or outsource this function
  • negotiate longer credit terms with suppliers
  • can you reschedule any loan agreements to reduce monthly payments?
  • sell any unused assets such as machinery and vehicles you don’t use
  • can you sub let and part of your premises?
  • can you reduce your wage bill?

An Invoice Finance Quote is available from many places but at Smart Factoring Quotes we provide bespoke indicative terms for both invoice discounting and invoice factoring.

The invoice finance quote is based upon turnover, the number of debtors you have, the number of invoices you issue and our in depth knowledge of the invoice finance market.

Pricing is obviously an important aspect of any facility but it is imperative you look beyond headline rates. Take a look at our article about calculating factoring fees and also the article about comparing factoring quotes.

Factor 21 are a small family owned independent invoice factoring company based in Oxfordshire. They are small and hands on in their approach and Graham Ethelston keeps things simple and focusses on good quality service for their factoring product.

I have several clients that use Factor 21 and they only have good things to say about them. They communicate well with clients and are flexible and open in terms of their approach.

My only criticism of Factor 21 would be that they are not always as responsive as what I might hope in terms of their sales process. They are however a small operation and I suspect they are to some extent victims of their own popularity when it comes to response times.

Factor 21 are not for everyone but for some businesses they are the ideal finance partner.

If you are looking for a factoring company and are considering Factor 21 it is worth contacting Smart Factoring Quotes in the fist instance to see which invoice finance company is best placed to meet your needs.

Would you like to review or provide feedback on your experience of Close Brothers Invoice Finance? Reviews are at the bottom of this page and links to some interesting articles and blogs below.

It is probably fair to say that if you are looking for a provider of invoice finance there are better options out there in terms of pricing, structure of facilities and customer service levels.

Close Brothers Invoice Finance are part of Close Brothers Group Plc and provide invoice finance solutions to over 1,000 clients. They are a national player with full UK coverage. They also offer invoice finance facilities in Ireland and Northern Ireland.

They are one of the larger independent invoice finance companies with offices in Brighton, Manchester, Dublin and Belfast.

In our opinion, more common complaints about Close Brothers Invoice Finance include their lack of flexibility, charges such as minimum base rates, their arrogant approach and some people have described them as ‘unapproachable’.

Read more:

An independent blog post about Close Brothers putting a business into administration – click here

Article on Close Brothers Invoice Finance pricing – click here

Article regarding a restrictive facility structure – click here

Trustpilot makes for some interesting reading – click here

It also appears there is a blog dedicated to Close Brothers – click here

Close Brothers also feature in an article on complaints about wealth management companies where it states, “Close Brothers also features on the list with 169 complaints, but its complaints are related mostly to banking and credit with none related to investments.” Interesting. For the article – click here

If you would like to share your experiences of Close Brothers Invoice Finance please feel free to do so but please try to be objective and refrain from abusive remarks.

We have previously posted that Invoice-Finance.com was being worked on. The site is now up and running and is aimed at businesses looking for an invoice finance facility.

The site is a free online resource that offers invoice finance advice from dedicated invoice finance brokers. Free indicative quotes are available to businesses and advice is available online, over the phone and indeed face to face. Our aim is to offer free advice to businesses looking to set up an invoice finance facility at a level that they are comfortable with. Some business owners simply want to look online and obtain advice, others will want the comfort of speaking with an invoice finance expert while others will want to meet someone and obtain face to face advice. We look to offer all these services.

Our approach is simply to highlight what invoice finance options are open to a business and explain the pros and cons of each. From there a business owner can decide which invoice finance solution best meets their needs.

Invoice Discounting Services

They are the invoice finance arm of Skipton Building Society and provide a full range of recourse invoice finance solutions. If you require a non recourse invoice finance facility they can source an appropriate credit insurance policy from a third party provider.

We have dealt with Skipton Invoice Finance on several occasions and they can do an excellent job with their traditional approach to invoice finance. When I say traditional I am referring to their credit policy which relies heavily on the quality of the debt and the quality of the people within the business. They accept that some businesses have financial difficulties and as such fall foul of the banks criteria for invoice discounting. Their approach is a flexible one and their product offerings can meet the needs of a client but also mitigate any risks that are associated with a deal.

It would be fair to say that Skipton Invoice Finance are not for everyone and they will be the first to admit this. However, in some situations they can offer what other lenders don’t. Their communication style is also direct which means clients know exactly where they stand.