What Invoice Finance Companies Can Offer

This article was first published on Stories by Populous World on Medium
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The invoice finance business — now a $3 trillion-a-year global industry — can be traced to old trading practices and traditional financial arrangements. Fundamentally, getting paid upon completion of work rather than waiting weeks or months for customers to pay their bills, remains unchanged.

Imagine a manufacturer sending completed fashion items to a high street retailer, but the retailer won’t pay for the goods until they sell it. An invoice finance company, a third party with adequate resources will advance the manufacturer the money owed from invoices, minus a fee for taking on the risk of non-payment.

The basic principle of invoice finance is very simple. The manufacturer and the customer enter an agreement with an invoice finance company for early clearance of unpaid invoices.

The customer provides guarantee and verification for the clearance of the invoices on the due date, against which the invoice finance company extends credit of 80 to 95 percent of the invoice value, minus a small processing fee, to the manufacturer (invoice seller).
Once the due date for the invoice arrives and payment is made, the manufacturer pays the invoice amount to the invoice finance company.

What Invoice Finance Companies Can Offer

Populous World is an invoice finance provider that can offer a vital solution to cash flow crunches. There are numerous advantages for SMEs when adopting this service, particularly in this current economic climate where smooth cash-flow is more crucial than ever:

1. Release cash quickly — Most reputable invoice finance companies can provide you with 90% of the sales value of your invoices within 24–72 hours. This means you’re not left waiting around for individual invoices to trickle in, leaving you with the funds you need to successfully develop your business.

2. Free up your time — With advanced cash in your account, you can focus on actually growing your ...

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Stories by Populous World on Medium

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