What is debt factoring?
For any company finding their time could be better-spent chasing new business rather than late payments, debt factoring could prove an attractive solution.
Debt factoring is the practice of selling your outstanding invoices to a third party who, in return, will provide you with cash up to a percentage of the invoice value. They will also process your invoices and collect all payments.
Why use debt factoring?
Unpaid invoices can create real problems for a business – not only do they constrain cash-flow and working capital, reducing the ability to act on new opportunities but simply chasing them can become a full-time job.
Debt factoring offers a cost-effective solution, with only a small fee charged per invoice with a high percentage of the invoice value loaned back.
The benefits of factoring debt
By outsourcing your sales ledger in this way, time that would have been spent raising and chasing invoices can be put back into managing the business and generating sales.
Factoring debts also means that cash is released as soon as any sales created are invoiced as orders, funding your next orders and creating a much smoother cash-flow.
If your business could benefit from turning time spent chasing payment into time generating new business, debt factoring may be the solution. Lloyds TSB factoring service offers funding of up to 90% of invoice value and optional debtor protection, safeguarding your business against the risks of insolvency or non-payment by your customers.
Get an instant online quote now to see if your business could benefit from debt factoring.
Lloyds TSB Commercial Finance Factoring Guide
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