What is Invoice Finance and How Does It Work?

Invoice finance (also called invoice financing) is a way to access cash tied up in your sales invoices. Instead of waiting 30, 60 or 90+ days for customers to pay, a provider advances most of each invoice’s value immediately. When the customer pays, the provider releases the remaining balance minus agreed fees.

Simple flow:

• You raise an invoice to a business customer.
• You submit that invoice to the funder/broker.
• The funder advances a percentage of the invoice value (typically 70–95% depending on the facility).
• The customer pays the invoice; the funder pays you the remainder less fees.

Two common models are invoice factoring (the funder usually handles collections) and invoice discounting (you retain collections; facility can be confidential). If you want to learn more about the differences and how each might suit your company, we can connect you to specialists who will explain options in detail. Free Eligibility Check.

Why Consider Invoice Finance for Your Business?

Invoice finance is widely used by fast-growing and established UK businesses to fix short-term cashflow issues without waiting on customers. Key benefits include:

• Unlock working capital quickly without taking on long-term debt.
• Flexible funding — draw against invoices as your sales grow.
• Helps you accept larger orders, pay suppliers, or cover payroll.
• Can work alongside existing bank facilities and lending lines.

Mini case study (anonymised): A Midlands manufacturer faced a £120k materials bill to fulfil a large order but had £150k in unpaid invoices. Matched with a selective factoring facility, they accessed £100k within 48 hours and completed the order, delivering growth without diluting equity or delaying payments. Curious what you could unlock? Get a Free Eligibility Check.

Invoice Finance Options We Can Match You With

Invoice Factoring

Factoring is often disclosed to your customers. The factor manages collections and advances a high percentage of invoice value. Best where outsourcing debtor management makes sense or when you need stronger credit control support.

Invoice Discounting (Confidential)

Discounting keeps collections with you and can be confidential (customers unaware). It suits businesses that prefer to preserve customer relationships or keep finance arrangements private.

Selective / Spot Factoring

Selective facilities let you fund only chosen invoices, ideal for seasonal spikes or one-off large sales. Lower commitment and flexible costs.

Specialist Facilities

Providers offer specialist options for exports, construction retentions, recruitment, or sectors with long payment cycles. Advance rates and fees vary by sector and debtor credit quality.

Typical advance rates range from about 70% up to 95% for very strong debtor profiles. Terms and fees depend on provider and the facility structure — we’ll connect you to brokers who will explain what’s typical for your sector. Tell us about your invoices.

Industries and Scenarios We Commonly Help

We match businesses across many sectors where invoice-led cashflow gaps are common, including:

• Construction & trades
• Manufacturing and engineering
• Logistics and transport
• Recruitment and professional services (B2B)
• Wholesale, retail & e‑commerce
• Hospitality and food supply chains

Common scenarios: rapid growth, long customer payment terms, seasonal trading swings, funding for large purchase orders, or smoothing cashflow after contract wins. If your sector isn’t listed, our panel still includes specialists who often support niche needs. Start your enquiry.

Eligibility & What Lenders Look For

Invoice finance providers assess both your business and the quality of your debtors. Typical requirements include:

• Trading history — many providers accept businesses with 3–6 months trading, though requirements vary.
• B2B invoices — facilities are usually against invoices to other businesses, not consumer sales.
• Debtor creditworthiness — lenders underwrite the invoices and prioritise customers with reliable payment records.
• Minimum invoice volume — some funders require a monthly invoiced value (often £10k+), but selective providers can support lower volumes.

Documents commonly requested: recent management accounts, an aged debtor list, sample invoices, and business/company information. Providing these upfront speeds matching and helps brokers give realistic indicative offers. Free Eligibility Check. (Subject to status and lender criteria.)

Understanding Invoice Finance Costs

Costs typically include a discount charge (interest-style fee) and a service or administration fee. Additional costs may include setup, audit or settlement fees. Key points:

• Discount charge is usually a margin over a base reference and is charged on the advanced amount over the period outstanding.
• Service or admin fees cover credit control, account management or reporting.
• There may be extra charges for early termination, audits, or international collections.

Because structures vary, comparing several providers is vital. We match you to multiple brokers so you receive a clear breakdown of all fees before you commit. All figures are indicative — final costs depend on your sector, debtor mix and facility type. Get Quote Now.

How Fast Business Loans Helps You Secure Invoice Finance

1. Complete a short enquiry form (2 minutes) — no impact on credit records.
2. We match your business to suitable invoice finance brokers and lenders based on sector, debtor profiles and funding needs.
3. You receive contact and indicative quotes from matched partners.
4. Decide which partner to proceed with directly — they’ll handle the application and onboarding.

Our service is free and no obligation. We only share your details with partners who can help and who we believe fit your circumstances. Start with a quick enquiry to see realistic options. Start Your Enquiry.

Why Choose Fast Business Loans for Invoice Finance Introductions?

We focus on making the search fast and effective:

• Access a panel of vetted brokers and lenders experienced in UK SME finance.
• Save time — complete one enquiry and receive multiple matched responses.
• Compare options and fees quickly so you can negotiate or choose the best fit.
• Free to use — our service is paid by partners on successful referral, never by businesses enquiring.

“Fast Business Loans helped us find a broker who understood our sector and moved fast — funds arrived within days.” — placeholder testimonial (to be updated).

Ready to compare invoice finance offers? Get a Free Eligibility Check.

Key Risks, Considerations & Responsible Use

Invoice finance can transform cashflow, but there are important considerations:

• Disclosed factoring may affect customer relationships; consider confidential discounting if this is a concern.
• Fees reduce net receipts — compare total cost vs benefit of faster cash.
• Contract terms: notice periods and termination fees can apply.
• Debtor concentration: heavy reliance on a small number of customers can limit available funding.

We do not give financial advice; our role is to introduce you to providers who can explain risks and help you decide. Speak with your accountant or adviser if unsure. Have questions? Start here.

Ready to Begin? Here’s Your Next Step

Use this quick checklist to prepare before you enquire:

• Decide your funding goal (e.g., cover payroll, accept new orders).
• Gather recent management accounts and aged debtor list.
• Have a few sample invoices ready (B2B only).
• Complete our short enquiry so we can match you to the right brokers/lenders.

Start Your Free Invoice Finance Search — enquiries typically take under 2 minutes. Remember: this is not an application and will not affect your credit score.

Invoice Finance FAQs

Does enquiring through Fast Business Loans affect my credit score?

No. Completing our enquiry form does not leave a credit footprint. Lenders/brokers may conduct checks later if you choose to proceed.

How quickly can invoice finance release funds?

Many businesses receive up to 70–90% of an invoice value within 24–48 hours once a facility is approved, but timing varies by provider and onboarding requirements.

What advance percentage can I expect?

Advance rates typically range from 70% to 95% depending on debtor credit, sector and facility type.

Is there a minimum facility size?

Our partners commonly work with facilities from around £10,000, though specialist providers can support lower monthly invoice volumes in some cases.

What’s the difference between factoring and discounting?

Factoring usually includes the provider handling collections and is often disclosed to customers. Discounting keeps collections with you and can be confidential.