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Crowd Invoice Factoring

Crowd Invoice Finance

Crowdfunding

Crowdfunding is a word that has recently been added to the dictionary, and you might have seen it crop up a few times in the press. In terms of alternative finance, crowdfunding usually refers to equity finance, raised online from a pool of investors.

Providers that offer this type of finance normally vet the businesses applying and choose the most promising looking business plans to feature on their platform. Investors then have an opportunity to invest for a small chunk of equity, and they diversify their risk by investing in a range of businesses at the same time.

Invoice Trading

You might have heard of invoice finance, factoring or invoice discounting- but this is different.

Invoice trading platforms provide finance for businesses against individual invoices, rather than signing clients up for long term contracts. It’s called ‘invoice trading’ because it connects businesses selling invoices with investors lending against those invoices via an online ‘peer-to- peer’ network.

The finance can be provided more cheaply and quickly than by traditional spot factoring or single invoice discounting providers.

Invoice trading is massively different to what’s gone before:

  • No contracts. That means no ‘setup fees’ or ‘termination fees’.

  • It’s pay-as-you-go, so the business is in control of how many invoices they sell.

  • Funds can be in your account on the same day.

  • In the vast majority of cases there are no debentures or personal guarantees.

For B2B businesses, waiting for clients to pay large invoices can make cashflow a nightmare. This new type of invoice finance can really help smooth out cashflow in a flexible way.

Please get intouch to find out if this is the right way to go for your business.

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