• Up To 25% Lower Charges By Taking Out Protected Invoice Discounting

    Interested in saving up to 25% on your invoice discounting charges?

    Some factoring companies will actually lower the service charge element of a factoring quote if you agree to take bad debt protection, as an optional extra.

    Up To 25% Reduction In Invoice Discounting Admin Charge

    A few well known providers recently quoted for a potential client and told us that they would be able to reduce the administration charge (often referred to as service charge, despite that term being more appropriate for factoring facilities) by between 20 and 25% if the prospect agreed to take out bad debt protection, also called "non recourse", rather than a recourse facility (where the risk associated with debtors failing is carried by the seller). So by adding non recourse with the right provider, you may be able to unlock such a saving.

    Credit Protection Element

    It is common for providers to quote fees as a service charge percentage of invoices discounted and an additional premium, often called the "credit protection element" of CPE if you choose to add non recourse. This is not always the case, some providers do not dissect their fees in this way. Amongst those that do, in recent quotes they a few have indicated that they will reduce the service charge element (excluding the CPE) by up to 25% if the prospect adopts non recourse as opposed to recourse.

    The CPE quote is likely to vary between providers but it is often a standard additional charge that a particular provider makes for the credit protection.

    Benefits Of Protected Invoice Discounting (PID)

    Protected invoice discounting, or PID, puts all parties in a more secure position. The customer knows that if a debtor becomes insolvent, and they trade within a pre-agreed credit limit for each debtor, they will not suffer a bad debt. There can be some additional terms involved, such as first loss clauses (which are similar to having an excess on an insurance policy), and not all providers offer 100% bad debt protection in the first place (in some cases it can be say 90%). But despite these kinds of limitations, losses through bad debts can be largely mitigated by taking up these options.

    This protection can also improve the providers perception of the risk associated with funding a sale ledger, especially when the bad debt protection is backed by an external credit insurance policy. This may be what is driving their ability to discount the service charge in some cases.

    Share with:

Related articles

  • Read More

    100% Funding Against Invoices

    100% invoice finance funding levels are now available to a variety of industry sectors.One of our funding partners deals with funding car body repair invoices to insurance companies, and they fund those invoices at 100% less a flat fee percentage for using their service (the fee is just a few percentage points of the invoice value). The debt is bad debt protected, so there is no recourse to our...

  • Read More

    Make Money By Referring Companies For Business Finance

    You could make some additional money by referring companies to us that need business finance. We get paid a commission on any deals that we successfully place and they take up a facility. We would be happy to split any commission received with you.CONTACT US ABOUT INTRODUCINGThere is lots of information on our website about the kinds of finance that we can find for companies. In broad terms it...

  • Read More

    Earn Commission By Introducing Companies Needing Business Finance

    You can earn commission by referring UK companies, that want business finance, to FundInvoice. You can either introduce prospects, or add a link to your site that will do that automatically (see below).Use our contact form to refer a prospect now (don't forget to include your details) - or you can call Sean on 03330 113622, with the details.FundInvoice provides a free, independent quote search...

  • Read More

    1% Over Base Rate For 12 Months

    We have a new special offer for our clients - a very low discount charge (which is the equivalent of interest when referring to receivables financing facilities).The offer is an invoice finance discount charge of 1% over base rate (base currently being 0.5% at the time of writing), for the first 12 months from taking out a new facility.The offer is being made by just one of the invoice finance...



Examples of just a few of our finance partners:

ultimate finance group
funding invoice
metro bank sme finance