2 min read
Definition
Invoice finance lets a business unlock cash from unpaid invoices rather than waiting the full credit term to be paid. A lender advances a large share of each invoice — commonly up to around 80–90% — as soon as it is raised, releasing the balance (less a fee) when the customer pays. Funding scales automatically with the sales ledger.
Its two forms are factoring (the lender collects, usually disclosed) and invoice discounting (you collect, usually confidential). See the full invoice finance guide and invoice finance vs a loan.
Related reading
Invoice finance: a complete guide
Invoice finance turns unpaid customer invoices into cash you can use now. This guide explains factoring…
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Invoice discounting vs factoring: which to choose
Within invoice finance, discounting keeps collections and confidentiality with you; factoring hands them to…
Read →Invoice finance vs a business loan
Invoice finance advances cash you are already owed; a business loan lends you a separate sum to repay in…
Read →Factoring
Factoring is a form of invoice finance in which a business sells its unpaid invoices to a provider for an…
Read →Funding for UK limited companies
Credicorp lends to your company, not to you personally — short-term working capital with no personal guarantee. See what your business could access.