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Invoice Finance

Invoice finance is a strategy for businesses to obtain funds by offering their unpaid invoices to a financial institution in return for a cash advance. Essentially, we will provide your business with a short term loan based on income earned but not yet received.

Such financing can be utilised by a company awaiting cash flow to cover immediate operating expenses, or capitalise on sudden growth opportunities that will help expansion. The best fit for invoice financing is business-to-business companies with established clients who are known for reliable payments.

To demonstrate, your business offers a service or sells a product and issues an invoice for it. Next, your business will send the invoice to an invoice financier, and the two will then establish loan terms. If successful, the financier will send your company the requested loan. Once your customer pays their invoice you can then repay the loan to your financier.

At Nucleus, once your business’s eligibility for invoice finance has been determined, we can offer you lending between £100,000 and £50 million. During processing, we will examine your financial statements to get a clear and precise picture of your trading history. We will also take into consideration your customers’ invoice repayment times.

It is worth noting that due to the type of facility, the cash advance you receive will only be a percentage of your original invoice. For example: an agreement of 80% on an outstanding £100,000 invoice will grant your business £80,000. This advance will then be paid back plus the agreed rates that can be negotiated during application.

Always take this total percentage forward into account when calculating how much finance you need to cover your business’s short term costs, as a single invoice may not be enough. If your business is eligible, multiple invoices can be financed at once.

With each of these factors considered, we can work together to determine a finance plan that is best for your expanding enterprise. Despite the loan range of our invoice financing, if your business is already established and has a history of steady cash flow, one of our other loan types may be more suitable for your current growth goals.

It is standard for any invoice financier to receive a small fee when taking payment. With Nucleus, the pricing of a typical invoice financing facility is dependent on your individual business, its requirements, and your own financial objectives. Rates can be set at anything from 0.1% to 2% per invoice, leaving you in full control to select your budget and access the funds necessary to reach your ambitions.

This in practice would see an invoice finance agreement of 80% on an outstanding invoice of £100,000, with an agreed fee repayment of 1%, return a total of £80,800 to the financier. The 1% is based on money loaned, which in this case equated to £80,000, and not the £100,000 amount of the original invoice.

Because invoice financing is a form of funding which uses unpaid invoices as the collateral itself, we instead take a debenture charge as security over them.

We will also consider the creditworthiness of your customers who are responsible for paying the invoice, rather than evaluating the background of the business owner who is seeking finance.

Dependent on the size of your loan and your individual business, additional security may be required but this is negotiable and bespoke. Our number one goal is to see your business flourish, and be in the financial position where you can grasp new opportunities.

Yes, we would be happy to put you in touch with an existing client, please do not hesitate to contact us at any time on – 020 7839 1980 – to make an inquiry with one of our teams. Alternatively, you can request a call back at a time convenient to you.

Transparency is important to us at Nucleus, and there are a number of common priorities you will find we require from each of our clients. A company should ensure that its accounts receivable come from customers with a proven track record of timely payments. Furthermore, they should be aware that their own credibility and financial standing will be considered when applying for financing, even if it isn’t the primary focus.

Typically, it takes around a month to complete the invoice financing process, but can be faster or longer. The main hold up is often access to documents. We aim to thoroughly review your financial statements to ensure they provide a clear and accurate account of your trading history.

When assessing potential candidates for invoice finance, providers look at the creditworthiness and payment records of both the invoicing company and also its customers. We are more likely to work with companies that consistently produce quality products or services and make punctual payments. This reduces the risk of non-payment, allowing the provider to grant financing on comfortable terms.

To ensure that clients remain viable risks, providers may continue to monitor their customers’ payment behaviour with ongoing credit checks, this allows both invoicing businesses and their financiers to make knowledgeable decisions on which invoices should be funded and at what rates.

If you are seeking invoice finance, we encourage transparency with our team, and that you have all your documents readily available to ensure efficiency. Once accepted you will have access to your funding line within a day.

At Nucleus, we will always take the time to understand a business’ story, and that includes turnaround situations. We are highly experienced in helping enterprises recover and realise that for any business, it’s not always smooth sailing.

If there is total honesty and transparency between us, we can work closely with you and your

insolvency practitioner. If we feel it is viable, and a sound recovery strategy is being proposed, we will offer and tailor a solution to support your business to a more positive future.

Yes. After an initial call with one of our experts and the potential for Nucleus to support you has been established, we will arrange a convenient time to come to your business for a site visit.

This is a great opportunity for us to get to know you and your enterprise while we learn how you operate and look at the relevant documents. At this time, you may also wish to ask us further questions regarding our invoice financing, and encourage you to prepare any queries you may have ahead of time so you can be confident you are making the best choice for your business.

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