Factoring offers most businesses the great benefit of providing cash against unpaid invoices. Due to the way that borrowed money is secured, factoring frequently allow businesses to borrow larger amounts of money compared to more traditional forms of commercial finance such as bank overdrafts.

You will receive advances of funds against your outstanding sales invoices. You inform your bank or invoice factoring company electronically or by post that you have issued an invoice and the factoring service will typically provide up to 90 percent of the value of your invoices and can usually be paid out within 24 hours of raising them. The remaining debt is forwarded to you once the debt is settled, less any finance charges.

A key benefit of invoice factoring is its ability to provide credit management releasing valuable time for your business. The factoring company will agree on the procedures with you and send statements and reminders to your customers of outstanding debts. Beyond this, you at all times remain in control of your customer relationships.