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Invoice Finance · Rates & Costs

The Invoice Finance 100.
Rates & Costs

Focus: Fees, interest rates, and the total cost of borrowing.

22+Questions
100%Expert Answers
FCARegulated
How does factoring compare to using business credit cards for cash flow?
TL;DR Compare factoring and business credit cards for UK cash flow. We break down the differences in cost, application requirements, repayment structures, and the impact on your business's financial health.
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Can I use invoice factoring for international invoices?
TL;DR Yes, you can use invoice factoring for international invoices, known as export factoring. Learn about the process, FX risks, and finding specialist UK lenders who handle cross-border trade.
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Can invoice factoring work for government contracts?
TL;DR Invoice factoring can work for government contracts, but specific challenges exist due to long payment cycles and procurement rules. Learn how UK factoring companies handle public sector debt.
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How does invoice factoring compare to peer-to-peer lending?
TL;DR Comparing invoice factoring vs P2P lending? Understand how these UK business finance methods differ in risk, cost, speed, and application. Choose the right funding for your SME.
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What’s the difference between receivables financing and invoice factoring?
TL;DR Understand the key differences between receivables financing and invoice factoring. We explain how both processes work, the critical distinction of confidentiality, and the implications for your UK business cash flow.
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How is factoring used in supply chain financing?
TL;DR Factoring is key to supply chain financing, providing immediate liquidity by converting invoices into cash. Learn how factoring streamlines cash flow for UK businesses and manages payment delays effectively.
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What is reverse factoring, and how does it work?
TL;DR Learn about reverse factoring (supplier finance). Discover how large buyers leverage a finance provider to pay invoices early, offering crucial working capital support to their suppliers.
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How does factoring influence my business valuation?
TL;DR Understand how invoice factoring impacts your business valuation. We cover the effects on cash flow, working capital, and perceived financial stability for UK businesses.
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What is the difference between factoring and forfaiting?
TL;DR Understand the key differences between factoring and forfaiting in trade finance. Factoring is short-term invoice sale (often with recourse); forfaiting is medium-term debt purchase (always without recourse).
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What is the effect of factoring on cash flow forecasting?
TL;DR Understand how factoring impacts your business cash flow forecasting. Learn to accurately track immediate inflows and account for factoring fees to maintain financial stability.
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What are the advantages of factoring over merchant cash advances?
TL;DR Factoring and MCAs offer quick business funding. Learn the key differences, focusing on control, costs, repayment structures, and collateral requirements to determine which funding method best suits your UK business needs.
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What types of invoices can be factored?
TL;DR Discover what types of invoices can be factored in the UK, from standard B2B sales to specific contracts. We explain eligibility criteria, excluded invoices, and key considerations for choosing invoice factoring.
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Is invoice factoring legal in the UK?
TL;DR Yes, invoice factoring is entirely legal and regulated in the UK, providing vital working capital solutions for businesses. Understand the regulations, costs, and key risks involved.
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What are the legal requirements for using invoice factoring?
TL;DR Understand the legal necessities of invoice factoring in the UK. We cover contract essentials, notice requirements, assignment of debts, FCA regulation, and compliance obligations for businesses.
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Who is responsible for debt collection in invoice factoring?
TL;DR Understanding who is responsible for debt collection in invoice factoring is crucial. Learn about recourse vs non-recourse factoring and how the funder handles customer payments.
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How does invoice factoring impact accounts receivable reporting?
TL;DR Understand how invoice factoring affects your balance sheet and financial statements. We detail the impact on accounts receivable reporting under UK standards (IFRS/FRS 102).
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What are the regulatory requirements for factoring companies?
TL;DR Understand the complex regulatory framework for UK factoring companies. Learn about FCA oversight, AML duties, and essential legal protections under UK law.
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How is customer data handled in invoice factoring?
TL;DR Understand how customer data is processed and protected during invoice factoring in the UK. We cover compliance with GDPR, confidentiality agreements, and data security measures.
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Can service-based businesses use invoice factoring?
TL;DR Discover how service-based businesses can access working capital using invoice factoring. We explain the process, benefits, and common considerations for UK firms.
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How does invoice factoring work for transportation and logistics companies?
TL;DR Invoice factoring helps transport and logistics firms manage cash flow by selling outstanding invoices. Learn the process, costs, benefits, and risks specifically tailored for UK hauliers and carriers.
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Why is invoice factoring popular in the manufacturing industry?
TL;DR Discover why invoice factoring is the finance method of choice for UK manufacturers. Learn about cash flow benefits, managing long payment terms, and scaling operations quickly.
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How can healthcare providers use invoice factoring?
TL;DR Discover how healthcare providers can use invoice factoring to manage NHS payment delays and improve cash flow immediately. Understand the benefits, costs, and risks involved.
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Promise Money is a broker not a lender. Therefore we offer lenders representing the whole of market for mortgages, secured loans, bridging finance, commercial mortgages and development finance. These loans are secured on property and subject to the borrowers status. We may receive commissions that will vary depending on the lender, product, or other permissable factors. The nature of any commission will be confirmed to you before you proceed.

More than 50% of borrowers receive offers better than our representative examples

The %APR rate you will be offered is dependent on your personal circumstances.

Mortgages and Remortgages

Representative example

Borrow £270,000 over 300 months at 7.1% APRC representative at a fixed rate of 4.79% for 60 months at £1,539.39 per month and thereafter 240 instalments of £2050.55 at 8.49% or the lender’s current variable rate at the time. The total charge for credit is £317,807.66 which includes £2,500 advice / processing fees and £125 application fee. Total repayable £587,807.66

Secured / Second Charge Loans

Representative example

Borrow £62,000 over 180 months at 9.9% APRC representative at a fixed rate of 7.85% for 60 months at £622.09 per month and thereafter 120 instalments of £667.54 at 9.49% or the lender’s current variable rate at the time. The total charge for credit is £55,730.20 which includes £2,660 advice / processing fees and £125 application fee. Total repayable £117,730.20

Unsecured Loans

Representative example

Annual Interest Rate (fixed) is 49.7% p.a. with a Representative 49.7% APR, based on borrowing £5,000 and repaying this over 36 monthly repayments. Monthly repayment is £243.57 with a total amount repayable of £8,768.52 which includes the total interest repayable of £3,768.52.

THINK CAREFULLY BEFORE SECURING OTHER DEBTS AGAINST YOUR HOME

REPAYING YOUR DEBTS OVER A LONGER PERIOD CAN REDUCE YOUR PAYMENTS BUT COULD INCREASE THE TOTAL INTEREST YOU PAY. YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT.

Promise Money is a trading style of Promise Solutions Ltd – Company number 04822774
Promise Solutions, Fullard House, Neachells Lane, Wolverhampton, WV11 3QG

Authorised and regulated by the Financial Conduct Authority – Number 681423
The Financial Conduct Authority does not regulate some forms of commercial / buy-to-let mortgages

Website www.promisemoney.co.uk