If you’ve ever invoiced a client and your cash flow isn’t quite where it needs to be, you’ve probably felt like time starts to slow down. Your clients have a couple of months to clear the invoice and they are dragging their feet. Thankfully there are smarter ways to bridge the gaps.
Waiting for invoices to be cleared is considered one of the biggest inhibitors to growth for small to medium-sized businesses in the UK. The fact is, that gap between the invoice being sent and being cleared can stunt progression.
If your business is at the mercy of its clients’ payment schedules, you’ll be pleased to read that there are options available to get out of the trap. Invoice financing is an innovative way to free up cash that always seems to be just around the corner.
So, what is invoice financing and how can it benefit my business?
Invoice financing is a pretty simple process. Let’s have a look at a quick example. A lender will take your invoice of, let’s say, £5,000. They will then usually lend you up to 85% of its value (£4250). This money will then be sent to you within a couple of days, sometimes sooner. Once your client pays the invoice, the lender will return the remainder to you minus their fees.
This is a fantastic way of accessing funds early. If, like many businesses, positive cash flow is a critical element of your operation, you’ll understand the benefits of accessing cash as and when you require it.
Sometimes in business, new opportunities present themselves out of the blue. In order to grow and build on what you have, your business must be reactive in its response to such possibilities. If a new opportunity arrives and requires an injection of cash, you need your cash flow to be healthy.
If you think SME invoice finance can add value to your current cash flow situation, get in touch with us today for the best possible prices on the market.