Invoice finance

Invoice discounting

A confidential facility. You keep credit control. Customers pay into a trust account in your name. Prepayments up to 95%, facilities from £10k to £50m+, UK and overseas debt in multiple currencies.

Apply for Invoice discountingInstant invoice quoteLearn moreOn qedfinance.com
Range
From £10,000
Term
Revolving with the ledger
Family
invoice
Search
Full market, one file

At a glance

  • Confidential
  • Up to 95% prepayment
  • You keep collections
  • £10k–£50m+

How it works

  1. 1You raise invoices as normal and keep credit control.
  2. 2The funder advances typically up to 90–95% of eligible invoice value, often the next working day.
  3. 3Customers pay into a trust account in your name. They do not need to know you are funding the ledger.
  4. 4When the invoice is paid, the advance is repaid and the balance (less charges) is released to you.
  5. 5As the debtor book grows, so does the cash you can draw. Facilities run from £10k to £50m+.

Who it’s for

  • B2B businesses selling on credit terms (generally under 90 days)
  • Companies that want to keep collections in-house and stay confidential
  • UK and overseas debt, multiple currencies
  • Start-ups through to multi-nationals with a growing sales ledger

Good to know

You advise new invoices electronically, often in batches. The provider runs a balance, not a full mirror of every invoice.

Expect at least one audit of books and procedures per year, usually on site.

Pricing is competitive because many providers offer this product.

One application with QED searches the full market. That saves you running the same file around several lenders, and it avoids multiple credit searches on the business and directors. A hard search is only placed when you proceed with a chosen lender.

Invoice discounting vs factoring

Drawn from the comparison table on qedfinance.com/invoicefinance and qedfinance.com/how-does-invoice-finance-work.

Facility size

Invoice discounting

£10k to £50m+

Factoring

£10k to £50m+

Prepayment

Invoice discounting

Up to 95%

Factoring

Up to 95%

How invoices are advised

Invoice discounting

Electronically, often in batches. Running balance — the provider does not mirror every invoice.

Factoring

Each invoice. The provider runs a mirrored sales ledger, statements and collections.

Who does credit control

Invoice discounting

You do

Factoring

The factor (or you, if agreed)

Do customers know?

Invoice discounting

No — confidential. Payments go to a trust account in your name.

Factoring

Usually yes — notice of assignment. A few UK houses offer confidential factoring.

Monthly statements

Invoice discounting

You send them

Factoring

The factor sends them

Who customers pay

Invoice discounting

A trust account in your name, managed by the funder

Factoring

The factor, who tells you when cash lands

Audits

Invoice discounting

At least one on-site audit of books and procedures a year

Factoring

Spot checks, often remote, because they already run the ledger

Worked example — £1,200 invoice

  • £1,200.00 gross sales invoice (incl. 20% VAT)
  • 30-day credit terms offered to the customer
  • Funder advances 85% against invoices
  • Customer pays 22 days late
  • Service charge assumed at 2%

Day 1

With invoice finance

£0 — goods delivered, invoice raised

Without

£0

Day 2

With invoice finance

£1,020 in the bank (85% of £1,200)

Without

£0

Day 40

With invoice finance

Still £1,020 — invoice is 10 days overdue

Without

£0 — still waiting

Day 52

With invoice finance

£1,176 net after the advance is repaid and 2% charged

Without

£1,200 lands in one go

You had 85% of the money on day 2 — cash to buy the next job, pay staff or take a discount from suppliers. By day 52 you have £1,176 of the £1,200 (the 2% fee). Same numbers as qedfinance.com/how-does-invoice-finance-work.

You wait the full 52 days with nothing. Late payers freeze payroll, materials and the next contract. That is the cash-flow problem invoice finance is built to solve.

Documents QED will ask for

Same list as the attach-files section on the website application. Tick what you have when you apply; email the rest.

  • Last published accounts (full accounts, not abbreviated)
  • Latest management accounts if year-end is stale
  • Last 3 months’ business bank statements
  • Last month-end aged debtors report (summary)
  • Last month-end aged creditors report (summary)
  • Live customer names, addresses and contacts
  • Existing invoice-finance contract and latest statement (if refinancing)

FAQ

Drawn from qedfinance.com and the way the UK market actually underwrites these facilities.

What is the difference between invoice discounting and factoring?

Discounting is confidential and you keep credit control; customers pay a trust account in your name. Factoring is usually disclosed, the factor runs collections and a mirrored sales ledger, and customers pay the factor. Both can advance up to 95% and both run from £10k to £50m+.

Who can use it?

Any B2B business selling on normal credit terms. The quality of the receivable matters more than the strength of the user. It is not available for B2C-only ledgers.

How quickly do I get the money?

Typically within 24 hours of invoices being assigned, once the facility is live.

A worked example?

A £1,200 invoice (incl. VAT) on 30-day terms, 85% advance: you receive £1,020 on day 2. If the customer pays 22 days late (day 52), the funder takes back the advance, charges for the period (say 2%) and releases the balance — about £1,176 in hand versus waiting the full 52 days with nothing.

What is invoice finance?

An advance secured on a receivable that will be paid by the debtor. It usually takes the form of factoring (disclosed) or invoice discounting (undisclosed), with many variants. For B2B businesses the sales ledger is often the biggest asset and the easiest to borrow against. The UK industry serves around 50,000 clients borrowing over £16 billion at any one time.

Is it only for B2B?

Yes in practice. Invoice finance is not available for businesses that are B2C only. The client must be selling to other businesses on normal credit terms, generally under 90 days. The quality of the receivable matters more than the strength of the user.

What does it cost?

Two parts: a service/discount fee on turnover (or a line fee) and a discount rate on funds in use, often linked to base rate. Competition among UK providers has pushed pricing down. QED searches the panel rather than locking you to one house.

Will I lose control of my customers?

Not with invoice discounting — you keep credit control and customers pay a trust account in your name. They do not need to know you are funding the ledger.

Is invoice finance only for struggling businesses?

No. The UK industry serves around 50,000 clients borrowing over £16 billion at any one time, from start-ups to multi-nationals. Growing companies use it because the facility grows with the sales ledger.

Will this affect my credit score?

Starting a search with QED does not place a hard search. Credit checks that can affect a score only happen when you proceed with a chosen lender.

Do my customers have to know?

It depends on the product. Invoice discounting is confidential. Factoring is usually disclosed (a notice of assignment on invoices), though a few UK providers offer confidential factoring.

Prefer a number first?

Run the same calculator that sits on the website, then apply if the shape looks right.

Open the calculator

QED is a broker, not a lender. A low credit score can limit options with some houses; a search with us does not place a hard search on the business or directors until you proceed with a chosen lender.