Why your business should consider using invoice finance

With the current strict lending criteria, many businesses in australia are having difficulty getting business finance to generate working capital or expand their business operations. Debtor finance or invoice finance is an alternative and attractive option for small businesses in these circumstances.

Below are some reasons why invoice finance or debtor finance may fit your business needs:

• Debtor finance gives the business a steady and reliable cash flow provided within 24 hours

• Get access to cash of up to 90% against the value of outstanding invoices with debtor finance

• Payments of the business liabilities can be made promptly on time and without the stress of business owners trying to find cash

• Grow your sales by offering your clients extended credit terms. Invoice finance is a strategic solution for business owners who target growth through credit sales as the ongoing supply of cash is linked to sales

• As the business grows, the amount of funding can grow with you

• Increased buying power with a reliable cash flow supplier

• Debtor finance assists with the purchase of a business or cash flow during the transition stage

• Debtor finance or invoice finance results in cash flow that's aligned with the business's performance and growth, rather than being dependent upon personal liquidity of owners

• No real estate security required with invoice financing

• Invoice financing gives your business the option to outsource accounts receivable. This eliminates the need to perform the accounts receivable function, allowing management to focus on growing the business

• Not tying up personal assets - debtor finance or invoice finance does not require owners to tie up their personal assets, for example property. Debtor finance relies solely on the businesses assets

• Increased flexibility with debtor finance – our mortgage brokers have access to over 20 mortgage lenders who specialise in invoice financing, who are independent to banks and offer a range of financial solutions to meet any your business cash flow needs

In the event that your business experiences problems with your trading or through no fault of your own, encounter major road blocks, like the loss of a large client, which could severely affect your business's financial performance, you can be assured that our mortgage brokers will work with you to source a flexible debtor finance or invoice finance solution that caters to your needs and circumstances. Our clients consider using invoice financing as an alternative to a business loan from their current mortgage lender, as it offers a strategic reliable line of funding for their business as they go through the painful process of restructuring.

• Invoice finance can free up cash tied up in unpaid invoices allowing businesses to pay trade creditors or statutory liabilities like the ATO

• Lending criteria through our invoice finance lenders are more flexible than a business loan through a bank, as a result obstacles like trading losses can be worked around rather that used as an excuse not to assist

Intellichoice has access to over 20 lenders who specialise in business cash flow and will assist to find a flexible solution to suit your needs. For more information about debtor finance or invoice finance and how it can help you grow your business, speak to one of our mortgage brokers at Intellichoice by calling 1300 55 10 45. In addition to invoice financing, we have access to other business cash flow solutions including stock finance or inventory finance, trade finance and equipment rental finance.

Guide to debtor finance and invoice financing

What is debtor finance, invoice financing or invoice discounting?

Debtor finance, also called invoice finance or invoice discounting is when a business sells all or part of their debtors' ledger (unpaid invoices) to a financier to raise working capital for business growth and expansion or other expenses, such as paying salary.

How does debtor finance or invoice financing work?

As a business delivers its goods or services to its customers, the invoices raised can be sold to a financier.

The Financier is able to advance up to 90% of the unpaid invoices value within 24 hours. The remaining 20% is advanced after the invoice is paid, less a small fee, payable to the financier.

The business simply forwards copies of the invoices to the financier. Once verification of invoices is complete funds are advanced. It is possible for the business to retain control over accounting functions and collections, or they can opt for the financier to follow up with the unpaid invoices on their behalf.

What are the benefits of debtor finance or invoice financing?

Debtor finance or invoice financing offers the business many benefits including:

• Funds are readily available - usually 24 hours

• Your business can negotiate better trading terms with suppliers, including early settlement discounts and the ability to buy in bulk

• Invoice financing eliminates the need to offer settlement discounts to customers

• Invoice financing fees are usually cheaper than settlement discounts

• You know with certainty when you will receive the cash with invoice financing

• No real estate security required with debtor finance

• You can save on management time and money by outsourcing debtor management to the financier or maintain control

What are the costs of invoice financing or debtor finance?

The fees for setting up an invoice financing facility will vary depending on the mortgage lender and is usually based upon setup structure, size and risk.

As a premier provider of business cash flow solutions, our experienced mortgage brokers first understand your business and then tailor a business finance solution to suit your business needs. For more information about debtor finance or invoice financing and how it can be used to improve business cash flow, speak to one of the mortgage brokers at Intellichoice today on 1300 55 10 45.

Improve business cash flow with invoice finance

Whether you need to improve business cash flow or expand business operations, invoice financing or debtor finance can provide you with the power to achieve this by releasing the cash from your debtors. Invoice finance or debtor finance provides a fast and efficient cash injection into your business that gives you the ability to meet your everyday creditor and payroll requirements. At the same time, it also allows your business the freedom to grow and expand without cash tension and operating a bank overdraft.

Businesses best suited to invoice finance/debtor finance include the following:

Benefits of invoice finance/debtor finance

• Business cash management flexibility for seasonal and daily requirements

• Convenient cash access when required using debtor finance

• Directly linked to the strength of the business credit sales

• Improve profitability through negotiated supplier discounts for early payment

Features of invoice finance/debtor finance

• Fund up to 90% of your debtor invoice value within 24 hours of processing with invoice financing

• Credit limit is based on your business sales and not your assets with invoice financing

• Online direct access to Account 24 hours a day

If you are concerned about your current credit facilities with your mortgage lender and would like to find out more about invoice finance, call 1300 55 10 45 to speak to one of the mortgage brokers at Intellichoice and how you can use debtor finance or invoice financing can grow your business.

Delivering business finance solutions for a changing market

Invoice Financing- We Step In Where Banks Leave Off

Invoice Financing is just one way Intellichoice simplifies and expedites capital acquisition, providing as much as 80 percent of invoice value to professional businesses in just 24 hours. So you save time and have the means to leverage revenue faster than you could through a mortgage lender or other lending facility. This is especially resourceful today, when mortgage lenders simply don't offer business loans as readily as they used to.

As mortgage brokers, we do all of the research for you, screening business loan and invoice finance products and narrowing your choices to just a few products perfectly aligned with your business needs. In addition to saving your time, we deliver invaluable counsel on how to structure your business finance or invoice finance product. Our mortgage brokers will help you keep personal assets separate and safeguard your best interests with our invoice finance solutions.

Invoice Financing has matured over the years, now recognised globally for its ability to provide tremendous flexibility when companies face time-sensitive monetary demands or growth opportunities. This power can help Directors reserve traditional lines of credit for emergencies.

Invoice finance can help you in the following ways:

• Obtain maximum financial backing for growth and expansion with invoice financing

• Instantly convert invoices into working capital with invoice finance

• Satisfy subcontractor and job-related expenses using debtor finance

• Enjoy tailored invoice financing solutions ideal for your needs

• Avoid long-term commitments with invoice finance

• Improve on business cash flow and help your business run smoothly using debtor finance

• Invoice financing does not require any real estate security - reduce personal exposure to the business and the risk of losing the family home

Contact one of the mortgage brokers at Intellichoice on 1300 55 10 45 to see if invoice financing is right for you. We can help you find the right business finance solution perfectly aligned with your business needs from our panel of 20 mortgage lenders. In addition to debtor finance, our mortgage brokers can also assist with other business cash flow solutions, including inventory finance, equipment rental and import finance.