Sometimes called Factoring, Invoice Discounting, Invoice Finance or Confidential Invoice Discounting. This allows businesses to access finance against invoices so that cash flow is improved. Often used when payment of bills falls earlier than receipt of invoices and is an excellent way of providing finance for expanding businesses. In return the bank charges an interest margin on the amount borrowed and a discount fee.
In recent years alternative lenders will consider financing single invoices rather than the entire debtor book. A better alternative for some clients.