Innovation Finance Invoice Financing

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How invoice financing works

1
The order
Create an invoice for your customer, showing how much is owed to your business and when payment is due.
2
Cash advance
Send a copy of the invoice to a lender to release up to 100% of its value as a cash sum.
3
Repayment
When it is due, the lender receives the payment from the customer. The lender then sends your business any remaining amount on the invoice that wasn't originally financed, after deducting the prearranged fees.

This comparison service is provided by Touch Financial. Touch Financial is a finance broker, not a lender. Not all products offered by Touch Financial are regulated by the Financial Conduct Authority. They compare invoice financing services from a range of different lenders, aiming to find the one that best suits the needs of their business customers. Touch Financial consultants look at the profile of each business, including cash flow, accountancy needs, and any other specific requirements, to match them with the most appropriate invoice finance provider and product. Touch Financial is authorised and regulated by the Financial Conduct Authority (FRN:727220).

Last updated on 12 May 2022.

Innovation Finance Invoice Financing FAQs

Who is Innovation Finance?

Innovation Finance is a UK business finance firm that specialises in invoice factoring, invoice discounting and bad debt protection. All IF services are tailored to suit the needs of their commercial clients to ease cashflow issues.

What is Innovation Finance invoice financing?

Innovation Finance provides invoice financing as a product to help businesses borrow against the value of their own invoices, in order to produce a stream of cash flow when they need it.

Why do businesses use invoice financing?

Invoice financing serves as a quicker means to obtain financing for businesses, especially if more conventional sources of cash flow are too costly or slower to obtain, such as regular business loans.

Is invoice financing a form of debt?

No, Innovation Finance invoice financing products don’t actually involve the creation or borrowing of new debts for you to pay off. In actual fact, invoice financing is a sale of your invoices to a lender or factoring company as collateral.

Why is invoice financing a quicker way to get cashflow?

Conventional business loans require a lengthy process of checking creditworthiness and other criteria, in order to deem whether you’re ready to take on new debt. Invoice financing simply turns unpaid or outstanding invoices into consideration.

Is invoice financing ideal when facing late payment?

The invoice financing Innovation Finance and other providers offer can be useful when facing common issues like late payment, as you can borrow against invoices yet to come, which you are rightfully owed by clients, without losing out financially.

What is Innovation Finance invoice discounting?

Invoice discounting relates to selling your invoices to your provider while remaining responsible for the management of your sales ledger. Rather than having your lender chase up invoice payments, you can maintain a discreet arrangement, so your clients need not know you are leveraging invoices as a result.

How does invoice factoring work?

Invoice factoring differs, as you are selling your invoices through to a factoring company, via your provider. This factoring company will be responsible for chasing up clients on those invoices. In the meantime, your provider is able to let you borrow a percentage of the value of invoices you expect to earn.

Does invoice financing come with fees or costs?

Yes, as with many financial products, Innovation Finance invoice financing will involve paying some fees or costs to your provider, but these are usually just a small percentage of the sum you wish to borrow against your invoices.ectly caused by late payment of invoices. The benefit of using these kinds of products is that you can receive cash injections before invoices have actually come through fully.

Does late payment affect invoice financing in any way?

By design, Innovation Finance innovation financing is supposed to provide cash flow precisely when you need it most, such as when payments remain unpaid or outstanding.

Can I be liable if clients fail to repay invoices?

Liability for late payment from clients only becomes an issue, if you signed a recourse agreement with your provider as part of the terms for the invoice financing facility. This means you are required to absorb the risk and repay the sum of failed invoice payments to your lender.

What does a non-recourse agreement do?

Signing a non-recourse agreement as part of your Innovation Finance invoice financing facility means your lender has absorbed the risk instead. They carry the costs from those failed invoice payments, but they are likely to require a higher fee from you, owing to higher risk, to compensate for this.

Services offered by this provider may change over time. Always check Ts&Cs.

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