INVOICE FINANCING

Free up cashflow from your unpaid invoices

Invoice Financing or Factoring is a cash flow solution that allows an SME to sell its receivables (invoices) to financial institutions to receive early payment.

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Loan amount:

Up to 90% of the invoice face value

Interest Rate:

1-3% per month with 2-3%
success fee

Subject to credit assessment

Duration:

15 days - 1 year (up to the
payment due date of the invoice)

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What is invoice financing?

Invoice financing is a commonly used financing facility for businesses to improve their operating cashflow through the shortening of your receivable days. This is facilitated through a financier who is willing to pay you a % of your receivable for a discount and manage the collection on your behalf. This is typically a more viable and cheaper financing option as compared to a general business term loan as the lender can rely on your buyer to make the repayment rather than your business cashflow.

Below is a quick diagram on how invoice financing actually works.

Don’t let payment terms hold you back.

Free up your cash flow instantly using your receivables to swiftly finance operational expenses, overheads or expansion.

Zero Collateral

East to apply, 48 hour approval

Advance up to $1,000,000

Flexible terms, choose the invoice to finance

Client sells $100,000 worth of electronic products to Buyer A on Day 1 and issues an invoice of $100,000. The invoice has a payment term of 45 days. This means that the buyer A will only pay the client on the 45th day of the sale.

On the 15th day the Client requires $50,000 to purchase new inventory for a new order and requires working capital. Therefore client sells his receivables of $100,000 from Buyer A to the Financier. The financier then informs Buyer A that the client has sold their invoice to the financier and instructs the buyer to pay the Financier directly on payment due date (45th day).

The Financier verifies the information and invoice and advances 90% of the invoice value less a factoring charge ($90,000 less 1% fee of $900).

On the 45th day, the financier receives 100% of the invoiced value directly from the buyer. This can be made into the financier’s account or an designated account named after the client.

On the same day of payment receipt, the client will receive 10% of the remaining invoice value from the financier less interest charged of approximately 1% per 30 days. Since financing was $90,000 for 30 days, the interest charged is $900). Total interest and fee paid for the process is $1800 ($900 factoring fee and $900 interest)

What are the benefits?

Free up capital with little requirements

Unlike other sources of business funding, invoice finance is relatively easy to qualify for even for newly set-up companies or companies with stressed financials with no collaterals and guarantors needed.

Ability to extend payment terms with confidence

Waiting 30, 60 or 90 days for payments can stunt the growth of smaller businesses, but not offering payment terms that are considered standard in your industry may make customers going elsewhere. Invoice finance allows business to extend payment terms to their customers without having to worry about the detrimental impact it could have on cash-flow.

Outsource your collection and monitoring

If you choose factoring, you can let the financier handle the credit control and collection which will better enable you to concentrate and manage your business. This applies to not only local invoices but global invoices as well.

Why get your property loan through Lendingpot?

Why get your invoice financing through Lendingpot?

A team that will support you

We have a dedicated team that will walk you through your entire loan process and help you do the market research you need.

We let lenders compete for your loan

Be ready to be spoilt for choice when we help you compare the best deals across all banks and non-banks so you only get the lowest interest rate and the highest cash out amount. Our rates are same as what the banks can offer or even better.

Save time in a single application

Compare across over 45 lenders in just 1 application.

Why get your invoice financing through Lendingpot?

A team that will support you

We have a dedicated team that will walk you through your entire loan process and help you do the market research you need.

We let lenders compete for your loan

Save time in a single application

Compare across over 45 lenders in just 1 application.

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FAQs

What do I need to prepare to apply for an invoice financing credit line?

How long does a process of application typically take for invoice financing?

How often can I finance my invoices?

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