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A guide to invoice discounting


With businesses increasingly turning to invoice finance, due to reported success and the steady decline in the popularity of bank loans, we take a look at the features of invoice discounting.

So, how does invoice discounting work?

Through invoice discounting, a business can access up to 90% of an invoice’s value within 24 hours of its issue, thereby avoiding the cash flow issues that can be caused by trading on credit terms. When the invoice is paid, you receive the remainder of the invoice, less the funder’s fees. Unlike its cousin factoring, which sees the funder also conduct the sales ledger management aspect on the client’s behalf, invoice discounting allows your business to retain control of its credit management and chase customers for payment as usual.

Is it that straightforward?

In essence, yes, although facilities can incorporate different aspects depending on the requirements of your business. For instance, debtor protection can be added on which safeguards your business against late or non-payment of the invoice, whether due to customer insolvency or protracted default. Facilities can also be extended to advance funding against other assets too, such as stock, property, plant and machinery.

Isn’t it just for businesses that are struggling?

Not at all. While this might have been true a few years ago, there are thousands of growing businesses that rely on invoice discounting to maintain a healthy cash flow as their company raises more and more invoices. Because the volume of funding a business can access grows in line with its turnover, it can be hugely beneficial for those raising just a few invoices a month to those that raise hundereds.

Which funders can offer invoice discounting?

There are a wide range of invoice discounting providers on the market, each with varying experience and some that specialise in different sectors. They vary from the major banks to smaller independents, and this gives interested businesses a range of options when searching for that ideal facility.

If you would like to find out more information about invoice discounting or factoring, our expert funding consultants are available on 0800 9774833 or emailed info@hiltonbaird.co.uk. They’ll be able to listen to your business’s objectives and funding requirements in order to introduce the most suitable funders and facility on the market.

To find out how much funding your business could release through invoice discounting, get an instant quote below:


Some of the funders we work with

  • Positive Cashflow Finance
  • Shawbrook Business Credit
  • 4Syte
  • Nucleus Commercial Finance
  • ABN AMRO Commercial Finance
  • Giant
  • Berkeley Trade Finance Ltd
  • Close Brothers Invoice Finance
  • Team Factors
  • Catalyst Finance
  • Asset Advantage
  • Gener8 Finance
  • Boost Capital
  • Investec
  • MarketFinance
  • Peak Cashflow
  • Roma Finance
  • Aldermore Invoice Finance
  • Davenham Asset Finance
  • Secure Trust Bank
  • Metro Bank SME Finance
  • Ultimate Finance Group
  • Creative Capital
  • Trade Finance Partners
  • Pulse Cashflow Finance
  • Lloyds Bank Commercial Finance
  • Calverton Finance
  • Partnership Invoice Finance
  • Spotcap
  • Santander Corporate & Commercial
  • Leumi ABL
  • Barclays
  • Bibby Financial Services
  • PNC Business Credit
  • Davenham Trade Finance
  • 1pm
  • Royal Bank of Scotland
  • InvoCap
  • inFund
  • iwoca
  • Innovation Finance
  • Regency Factors
  • IGF Invoice Finance
  • Merchant Money
  • Haydock Finance Ltd
  • Skipton Business Finance
  • Woodsford Tradebridge
  • GapCap Cashflow Finance

Authorised and regulated by the Financial Conduct Authority (FCA number 730445)
We are a credit broker and not a lender and offer credit facilities from a panel of lenders

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