How invoice finance works for UK businesses

Invoice finance helps businesses access cash tied up in unpaid invoices. Instead of waiting for customers to pay, a lender or broker advances a percentage of the invoice value so you can cover wages, suppliers or growth costs now.

Two common approaches:

• Invoice factoring — the finance company buys or advances against your invoices and may handle collections. This is useful if you want direct support with debtor management.
• Invoice discounting — you keep control of your sales ledger and collections; the lender provides confidential funding against your invoices.

Other options include selective (single invoice) finance and whole-ledger facilities. Which is best depends on your turnover, customer payment terms and whether confidentiality matters. If you’d like a quick, personalised comparison, start a Free Eligibility Check: Get Quote Now.

Is invoice finance right for your business?

Invoice finance is often the right fit when:

• Your business has invoices outstanding for 30+ days and cash is constrained.
• You’re experiencing rapid growth or seasonal peaks and need working capital to fulfil orders.
• Customers have long payment terms (e.g. 60–120 days) and you want to smooth cash flow.
• You want funding that grows with your sales rather than a fixed-term loan.

When it might not be suitable:

• If most of your turnover is from public sector or high-risk customers who are slow to pay, some providers may decline.
• Start-ups with limited trading history may face higher fees or restricted options — though some partners specialise in newer businesses.

If you’re unsure whether invoice finance or a different product (e.g. short-term loan, asset finance) is best, our matching process helps identify the most appropriate solutions. Start your enquiry — it’s quick and won’t affect your credit score: Free Eligibility Check.

Fast Business Loans: invoice finance matching process

1. Complete a short enquiry

Our enquiry form takes under 2 minutes. It collects business basics (company name, turnover band, invoice profile, typical payment terms) — this is an enquiry, not an application. We only use the details to match suitable lenders/brokers.

2. Intelligent matching

We match you to lenders and brokers who specialise in your sector or funding need (for example, construction CIS-friendly providers or confidential discounting for wholesale). Matching is based on criteria you provide and our partners’ appetite.

3. Rapid responses and tailored quotes

Matched partners typically contact you by phone or email with indicative pricing and next steps. Timescales vary but many businesses receive responses within 24–72 hours.

4. Support to funding

We continue to support you through the introduction — there’s no obligation to proceed and no fee for using our service. If you accept a provider’s terms, the lender or broker will perform credit checks and complete the onboarding process.

Note: We only introduce businesses seeking facilities of approximately £10,000 and upwards. Ready to be matched? Get Quote Now.

Benefits of invoice finance via Fast Business Loans

• Faster cash flow: turn unpaid invoices into usable cash within days.
• Flexible funding: facilities scale with your sales rather than adding fixed monthly debt.
• Choice of approach: confidential discounting keeps collections yours; factoring offloads collections if you prefer.
• Sector specialists: we match you to lenders who understand your industry risks and debtor profiles.
• Free, no-obligation matching: our service costs you nothing — lenders/brokers pay for introductions.

Case study (anonymised): A Midlands-based manufacturer converted £180k of invoices to immediate cash via selective invoice finance, smoothing payroll and supplier payments during a large contract. Results vary; example only.

Start a free enquiry and get matched with specialist lenders: Free Eligibility Check.

Invoice finance products we can introduce you to

Whole ledger factoring

Provider funds a percentage of your entire ledger. Typical advance: 70–90% of invoice value initially, with balances on payment. Suited to larger SME ledgers; useful if you want comprehensive funding plus collections support.

Selective/single invoice finance

Fund individual invoices as needed. Good for one-off cashflow needs or onboarding new contract work. Typical advance varies by provider.

Invoice discounting (confidential)

Confidential funding where your customers are unaware of the facility. Best for businesses that want to maintain customer relationships and manage collections themselves.

Construction invoice finance (CIS-aware)

Designed for contractors and sub-contractors with CIS payments and retentions. Some lenders offer tailored terms for the construction sector.

Comparison table

Want help choosing? Our partners can explain which product matches your needs — Get Quote Now.

For further reading on invoice finance fundamentals, visit our detailed guide to invoice finance.

Eligibility criteria & documentation

Typical information lenders request:

• Company registration, VAT status and registered trading address.
• Recent management accounts, VAT returns and bank statements.
• Details of your debtor book (number of customers, concentration risk, payment terms).
• Credit history of key directors and the business.

Minimum facility sizes commonly start around £10,000. Some providers will consider younger businesses if the debtor book is strong. To check quickly whether your business is likely to qualify, complete a short enquiry: Free Eligibility Check.

Costs, fees & how to compare offers

Invoice finance costs vary between providers and product types. Common cost elements include:

• Discount rate — a percentage charged against the invoice value (similar to interest).
• Service/administration fees — may be monthly or per-invoice.
• Set-up or exit fees — one-off costs in some contracts.

Comparison tips:

• Look beyond the headline advance rate — check ongoing service fees and notice periods.
• Ask about concentration limits (maximum funding on single large debtors).
• Clarify whether fees change as your turnover grows.
• Request a worked example showing total cost for a representative invoice.

We recommend getting at least two quotes so you can compare structure and suitability. Start a no-obligation comparison: Get Quote Now.

Industries we commonly support

Our lender panel includes specialists for many sectors, including:

• Manufacturing and wholesale
• Construction and building services
• Logistics and distribution
• Recruitment (payrolling invoices)
• Retail and e‑commerce
• Professional services with strong debtor books

If your sector is niche, tell us on the enquiry form — we often match businesses with sector-focused partners. Check Your Eligibility.

Frequently asked questions

What information do I need for the enquiry form?

Basic company details, approximate annual turnover, typical invoice values and payment terms, and a contact name/phone/email. This is an enquiry only — not a formal application.

How quickly can funds be released?

Timescales depend on provider and documentation. After formal approval, many facilities can advance funds within 24–72 hours for straightforward cases.

Will invoice finance affect my customer relationships?

Discounting can be confidential so customers are unaware. Factoring may involve the provider contacting debtors — discuss confidentiality preferences with matched partners.

Will applying affect my credit score?

Submitting an enquiry via Fast Business Loans does not trigger a hard credit search. Lenders/brokers you proceed with may perform credit checks later in the process.

Can I use invoice finance alongside other facilities?

Often yes, but it depends on lender covenants and the structure of existing facilities. Disclose current borrowing on the enquiry form so we can match appropriately.

Do you charge for your service?

No. Our matching service is free for businesses — there’s no obligation to proceed with any introduced partner.

Still have questions? Talk to a specialist — Start Your Enquiry.

Why UK businesses choose Fast Business Loans

We save time by matching you with lenders and brokers who understand your sector and funding needs. Our service is free, fast and focussed on getting you relevant quotes — not generic offers. We act as an introducer, not a lender, and do not provide regulated financial advice. Eligibility and terms depend on the chosen provider.

Begin a quick enquiry (under 2 minutes): Get Quote Now — Free Eligibility Check.

Ready to unlock cash flow?

If unpaid invoices are holding your business back, take two minutes to complete our enquiry form. We’ll match you with the lenders or brokers best placed to help — you receive tailored quotes and decide if you want to proceed. This is an enquiry only, not an application.

Get Started — Free Eligibility Check

Compliance note: Fast Business Loans is an introducer, not a lender. We do not provide regulated financial advice. Any facility and terms are provided by the lender/broker you are matched with and are subject to their assessment and approval. No hard credit search is performed to submit an enquiry; lenders may carry out credit checks if you proceed.