Top Advantages of Invoice Factoring Services

There are many advantages of using factoring if you're a business owner. One of the biggest is that you can quickly and easily boost your company's cash flow. This can be especially useful for businesses that are short of working capital, or that need to expand quickly.

Some other benefits include:

A choice of dozens of companies within the UK that offer factoring products. These include invoice finance and invoice discounting at various different rates. Because of the high level of competition within the marketplace, prices of factoring remain low and factors are willing to work with businesses that have lower turnovers.

Being able to outsource your sales ledger. Traditional factoring involves letting the factor handle your sales book, and this includes chasing invoices and securing payment from your customers. Businesses often find that this frees up a lot of time and resources that they can direct elsewhere.

Opting for non-recourse factoring means that the factor takes on the risk of bad debt. This means that if you use invoice factoring and then your customer doesn't pay, you don't have to pay anything - you're not liable for that debt. If you work in a high-risk industry or you've had problems with your customers in the past, this can give you the confidence to run your business without worrying about not being paid.

Finding out your customer's credit status. The factoring company will perform credit checks on everyone they collect payments from to make sure that they can actually pay. This can alert you in advance of any problems your customers may have, so you can take action before it's too late.

Sylvia is a business consultant with over a decade of experience streamlining business for cost savings. She writes about invoice discounting in order to help businesses with their cash flow.