What Is Invoice Financing
Invoice Financing

What is Invoice Financing?

Nobody ever said that running a business was easy. There are endless challenges awaiting intrepid business owners as they embark on sustaining and growing their business towards the future. However, one unexpected obstacle that too often appears is that of cashflow. Even when businesses are working with and invoicing large, reputable companies or organisations (including government) they can struggling to maintain good cashflow.

Why is this?

Essentially, it mostly comes down to when invoices are paid. Many small businesses are surprised to see payment windows of 30, 60 or even 90 days when invoicing to large organisations. For a small business, these long periods between works being completed and payment means it is difficult to maintain good cashflow. Money is needed to keep things moving, ensure employees are being paid, seek more work and grow a business, but when there’s a three-month wait, things get complicated. This is when cash flow stress takes hold.

Beyond The Banks

To reduce cashflow stress, it is not uncommon to see small businesses turn to the banks for loans, or to bury themselves in overdrafts. But banks are much more cautious now, and usually will not lend to small businesses without collateral. This complicates the process even further, and leaves business owners risking personal assets to secure business finance.

The good news is, there is a solution beyond the banks. It’s called invoice financing, which goes by many other names such as debtor finance, cashflow finance as well as invoice factoring. At Apricity, we want our customers to understand that our facility is not a loan, simply faster access to your money. But ‘invoice loan’ is a commonly used term and one we will use here.

Invoice loans are short-term finance facilities that businesses can use for invoices they have served that are awaiting payment. Invoice financing is accessible through companies like Apricity Finance, who work with businesses to figure out the best solution for their business. Invoice financing allows small businesses to bypass the rigidity of the banks and access the cashflow they need to survive between invoices, easing stress and promoting growth.

Three Reasons To Choose Invoice Loans

There are so many reasons to choose business invoice financing. Some of the most important factors to consider include:

1. Faster approval

Getting access to money from the bank can take time, and if you’re a small business you don’t always have time to wait. The benefit of invoice finance is that it is often approved much faster, particularly with a company like Apricity Finance. Faster approval times on invoice loans means less time wasted on stressing about cashflow, and more time for you to dedicate to your business.

2. Use Invoice-Only Security

While banks may require personal or business collateral for any money lending, invoice financing is a different story. In many cases the invoice loans that small businesses take out can be secured by the invoice only, particularly if that invoice is to a reputable company or organisation.

3. Allow You To Get Back To Business

Keeping cash flowing in a small business doesn’t have to be a major challenge. With invoice finance, businesses are free to grow and develop their business as they wish to, instead of always waiting for money to come in and living with cashflow instability. Invoice financing can mean less stress, fewer delays and the ability to take your business into the future.

If business invoice financing sounds like it might be worth investigating for your small business, or you’re struggling with cashflow and you want to get more information on invoice financing, you can get in touch with Apricity Finance today and see how we compare. Our team can assess your eligibility for invoice loans, and work with you to figure out a solution to your cashflow issues today. Why wait? Get in touch now.