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More Information on finance...

 

Invoice Finance

Factoring

In the most basic terms this is where the company sells a specific invoice to a factoring company at a discount, it is then for the factor to collect the debt owed.  This is not to be confused with invoice discounting which relies on the collection of the sales ledger as a whole.

Invoice Discounting

This is where the company is able to draw down funds from the total of all sales invoices outstanding (which have been assigned to the discounter).  If any of the outstanding invoices go bad, then this can affect the drawdown of funds impacting the cashflow, unlike factoring whereby the lending is specific to the invoice outstanding.

Merchant Finance

If you operate a credit / debit card terminal known as either a PDQ or Merchant Service and a good percentage of your turnover is paid using this method.  There is finance available whereby the repayment is made from future income taken directly from the terminal.

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