Factoring
Do I need factoring?
Normal commercial finance requirements of many UK businesses dictate a more flexible and tailored source of funding. Requirements may include:
- better working capital (startups and mature businesses)
- additional sales ledger management
- capital intensive projects
- acquisitions
- financing rapid growth
Many traditional forms of commercial finance offer limited access to funds due to either the age of your company or the lack of security you can provide.
Invoice finance services such as factoring offer something different.
Factoring is a flexible and tailored service which allows you to speed your cash flow.
How does factoring work?
Factoring (and invoice discounting, another form of invoice finance) offers most businesses an added advantage in raising funds or general cash flow assistance by providing cash against unpaid invoices. Due to the innovative way that borrowed money is secured, factoring frequently allows businesses to borrow larger amounts of money compared to more traditional forms of commercial finance such as bank overdrafts.
Factoring normally works as follows:
| Step 1 | You perform the service or provide goods as agreed with your client and notify us of the invoice value. |
| Step 2 | We pay into your bank account up to 90% of the value of the invoice as fast as 24 hours later. |
| Step 3 | We collect the payment for you. |
| Step 4 | We pay you the balance of the invoice value having deducted any fees. |
Lloyds TSB Commercial Finance Factoring Guide
- Get an Instant Quote
- Learn more about Factoring
- Read our factoring case studies
- Business Factoring
- Debt Factoring
- Factoring Services
- When to use factoring companies
- Invoice Management
- Factoring advantages and considerations
- Factoring for internal growth
- Loans, Overdrafts or Factoring
