There are many finance options open to your business. There are all the usual options such as loans, overdrafts and commercial mortgages, but these options are not the only finance services that businesses can utilise. There are many additional finance options which may suit you better, help your business to grow faster and be easier to obtain.
Such alternative business finance solutions include asset finance, trade finance, development finance, invoice factoring and invoice discounting. Some of the benefits to these are that they can help improve cash flow, get finance for businesses who otherwise would not be eligible for it, help manage your credit control or provide flexible finance solutions not possible with more traditional forms of credit.
Here at UKFinancialOptions.co.uk we can offer you information on all these alternative forms of invoice finance as well as all the usual channels for getting credit for your business. We can even arrange no obligation quotes on many of these financial products from two or three companies if you wish.
There are two forms of invoice finance, factoring and discounting.
Factoring is different from most forms of credit facility as it can grow with your business. An invoice factoring facility gives the finance company the responsibility to manage your credit control saving you time, plus they pay you between 80% and 90% of the invoice value within 24 – 48 hours. This is great for companies working in industries where they need to make a large initial outlay on the services they provide or have to wait 30 – 90 days for payment.
Invoice discounting is much the same as factoring in many respects, but with the key different being that you continue to manage your credit control and simply pay the invoice finance company once the invoice has been paid.
Asset finance enables you to borrow money against valuable assets that you have. The asset is used to secure the loan against. This can be a useful way of borrowing large sums of money and opens another funding option to a business.
Grants and Soft Loans
Also it is worth mentioning that many businesses are eligible for grants and soft loans from government schemes. You can find out more about these by visiting the Business Link website where they go into much more detail about these options.
Peer To Peer Lending
Peer to peer lending is a form of lending which has grown in popularity a great deal in recent years with the introduction of such companies as the Funding Circle. This form of finance works by bringing together investors and businesses looking for funding. Companies join a peer to peer website such as FundingCircle.com and they post their opportunity for investors to loan them money. The advantage for the lender is that they can typically get much better rates than if they were to go to a bank to borrow the money. The investor gets a better rate of interest than if they were to save their money in a standard savings account. The disadvantage with this type of finance is that in most cases you have to have been trading at least two years to qualify for it.