Lloyds Bank Invoice Finance

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How invoice financing works

The order
Create an invoice for your customer, showing how much is owed to your business and when payment is due.
Cash advance
Send a copy of the invoice to a lender to release up to 100% of its value as a cash sum.
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.

Lloyds Bank Invoice Financing FAQs

What is Lloyds Bank invoice financing?

Invoice financing is a financial product that Lloyds Bank and other providers offer businesses. These businesses are looking for additional liquidity because they want to expand and invest in themselves, but lack the sufficient cash flow to do so.

How does invoice financing work?

The invoice financing Lloyds Bank and other providers offer can allow you to borrow against the value of your own invoices, even if they are still unpaid or simply outstanding. It comes in the form of a cash injection, as a substantial percentage of the value of those invoices you wish to leverage.

Can I use invoice financing to handle late payments?

Yes, businesses of all shapes and sizes often face late invoice payments from clients. However, by leveraging your own sales ledger, you can free up sums of money before the actual invoices arrive. This will help you avoid serious cash flow problems that have occurred through no fault of your own.

Is it difficult for a small business to acquire invoice financing?

Lloyds Bank invoice financing or facilities offered by other providers may set specific criteria, which could exclude smaller, less mature businesses from using them. For example, your business might need to meet a turnover threshold or have been operating for a minimum number of years.

What is invoice factoring?

Invoice factoring is just one way of using Lloyds Bank invoice financing facilities. You sell your invoices, which are sent through to a factoring company via your lender. The factoring company is then responsible for making sure your clients pay invoices, while the provider makes a cash injection.

What is invoice discounting?

Invoice discounting is a more discreet form of Lloyds Bank invoice financing, letting you take responsibility for handling invoices instead. Your provider offers cash injections in line with those invoices.

Does invoice financing carry a fee?

Yes, providers usually charge some fee for providing invoice financing facilities. These are rarely much more than a small percentage of the value of your invoice borrowings, and are subtracted from the total sum.

How can I compare invoice financing products?

Touch Financial, our business finance specialist partner, is the ideal tool for helping you compare and contrast Lloyds Bank invoice financing facilities with those offered by other providers. All you have to do is follow the directions at the top of this page, and a consultant will assist you in finding the best provider for your invoice financing requirements.

Can I be found liable if invoices don’t get paid?

Yes, if you signed some form of recourse agreement with your lender, when using a Lloyds Bank invoice financing facility. This agreement means you agreed to absorb the risk if your clients should fail to pay invoices properly. Therefore, you need to repay the value of invoice borrowings back to your provider.

Can I protect myself against failed invoice repayments?

Yes, providers can offer non-recourse options, meaning they agree to absorb the risk instead and pay the cost if invoices go unpaid. This won’t affect your ability to continue borrowing against those invoices. However, the provider will charge a higher fee because the risk is elevated for them and they will need to compensate for it.

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

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