Single invoice finance or spot factoring describes the process of raising finance against a single individual invoice.
Such a process releases the cash locked up in invoices one at a time, without any long term obligation.
Spot factoring or single invoice finance is a new alternative to traditional wholesale factoring facilities and has many advantages over the original system.
As opposed to having to sell your entire debtor book, single invoice finance or spot factoring enables you to sell invoices in quantities you choose, when you choose to sell them. This provides greater flexibility to your debt management facilities and provides greater control over your everyday working capital.
You do not have to wait until you have a minimum quantity or are forced to sell invoices when cash flow is positive. Instead, you have the opportunity to make the business decisions that support your overall aims, when they need to be made.
Rather than entering into a lengthy and potentially expensive contract, single invoice finance or spot factoring offers a short term, immediate service which can often be cheaper too.
Single invoice finance or spot finance provides faster access to tied-up capital and the ability to make key business decisions at the touch of a button.
With lengthy, wholesale factoring facilities, organisations are usually required to provide company debentures or personal guarantees to secure the facility. However, with a short term facility such as a single invoice finance agreement, no such undertaking is necessary and the organisation need enter into no binding debenture.
In terms of selective invoice discounting (a type of selective/single invoice finance), it is not necessary to disclose to your customers that you are liquidating their invoices. Instead, you can enjoy complete confidentiality and full financial control within your existing relationships, yet still gain access to increased cash flow when you need it.
By their very nature, the cash flow balances in small and medium sized businesses across the UK are often very volatile, and traditional factoring processes offer only a very limited and sometimes costly resolution.
However, with single invoice finance or spot factoring there are no minimum monthly fees, greater levels of flexibility and full financial control. Ultimately, it is the solution many businesses have been waiting for.
If you would like to know more about single invoice finance, contact one of our specialist team on 0800 009 6106 or hello@myinvoicefinance.co.uk.
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