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What is Single Invoice Finance?

Published on 21st June 2018 - Last update on 13th April 2020

Whether you’re looking to reinforce your bottom line, pay staff wages, resolve unexpected expenses or prepare for an important contract, making sure that you have access to the necessary capital to back you up is vital. Naturally, it can be daunting navigating your way through what the UK lending landscape has to offer, but one way of achieving your goals is by applying for Single Invoice Finance. Although this option works similar to other Invoice Finance products, many businesses regard Single Invoice Finance as a more flexible method of borrowing. So what is Single Invoice Finance and how does it work?

Why should I apply for Single Invoice Finance?

What makes Single (or Selective) Invoice Finance such a popular funding raising tool for SME owners is the flexibility and control that it provides. Unlike traditional Invoice Finance, Single Invoice Finance doesn’t require you to run all of your business’ unpaid business-to-business (B2B) invoices through the same lender. This means that you’re free to choose which invoices to finance, when to submit them and which lenders to finance each one with. Therefore, you can release the cash tied up within your unpaid invoices at your own pace, in a manner that suits your business’ needs.

Having trouble managing your operating costs? Unexpected expenses? Need a flexible way of raising capital? Apply for Single Invoice Finance or learn more about how your business could benefit.

How does Single Invoice Finance work?

Single Invoice Finance operates in the same way as traditional Invoice Finance, allowing you to release up to 90% of the capital locked inside one or more of your outstanding B2B invoices worth in excess of £5,000. However, it’s worth familiarising yourself with the both Selective Invoice Discounting and Spot Factoring:

  • Selective Invoice Discounting: If your business generates an annual turnover of at least £100,000, you could be eligible for Selective Invoice Discounting, which also requires to keep your ledgers up to date and have an effective credit control procedure in place. Plus, rather than having your customer (the debtor) pay your business, they’ll make payment directly to the lender. Once they’ve fully paid off the money they owe, the lender will release a balance (e.g. 10% of the invoice) minus costs and fees.
  • Spot Factoring: On the other hand, your business could qualify Spot Factoring if your business has an annual turnover of at least £25,000. Although you’re required to maintain up to date business ledgers, this option allows the lender to pursue the customer responsible for repaying the invoice on your behalf, saving you time. Plus, you can also choose to be discrete about the fact that you’re using the services of an Invoice Finance lender. In addition, some lenders may offer you Bad Debt Protection, safeguarding your business in the event that your customer goes bankrupt or doesn’t pay what they owe.

Need to raise funds for your business?

No matter where your business stands, ensuring that it has access to sufficient amounts of capital is a priority. But rather than drawing funds from your own cash reserves, you could apply for Single Invoice Finance instead, giving you the confidence to steady, and even grow, your day-to-day operations. But with so many lenders to choose from, the next obstacle you need to overcome is sourcing a lender who can provide the flexibility you require, whilst also offering an agreement at a competitive rate.

At Rangewell, we’re an Access to Finance specialist working with over 300 lenders to offer you an overview of more than 23,000 business finance products. Our services are free to use and we’ll also guide through the application process. We’re with you every step of the way. So if you’re looking for a suitable Single Invoice Finance solution, apply today or find out more with Rangewell.

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David Harrison

David Harrison

Content writer
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