When your business pays wages and suppliers before customers settle their invoices, the gap can put pressure on cash flow. Invoice finance can provide an advance against eligible unpaid invoices, with the remaining balance released after payment and agreed charges. How the main arrangements differ Invoice factoring: the provider generally takes on collection of the…
A loan that suited your business when you took it out may no longer fit its cash flow or plans. Refinancing and debt consolidation are ways of reviewing existing borrowing, but a new agreement needs to be assessed on its full costs and commitments. What is the difference? Refinancing replaces an existing finance agreement with…
Sales and cash receipts do not always arrive at the same time as wages, rent and supplier bills. Working capital funding can help bridge a timing gap, such as buying stock before a busy season or meeting costs while waiting for customers to pay. Different ways to fund the gap Options can include a business…
Supply chain finance can allow a supplier to receive payment earlier on an approved invoice while the buyer pays later under agreed terms. It relies on a structured arrangement involving the buyer and a finance provider. How it works Often called reverse factoring, this typically begins when a buyer approves an invoice. A participating supplier…
The Growth Guarantee Scheme can support access to finance for eligible UK businesses through accredited lenders. The government guarantee supports the lender; it does not remove the borrower’s obligation to repay. How it works The scheme can support several types of facility, including loans, overdrafts, asset finance and invoice finance. The lender decides whether the…
An unsecured loan can provide a lump sum for business plans without a charge over a specific asset. It still creates a repayment commitment, and directors may face personal exposure. How it works A lender assesses trading history, cash flow, credit records and the purpose of the loan. The business repays capital and interest over…
A secured business loan uses property or other assets as security. It may support a larger or longer-term project, but the assets pledged could be lost if repayments are not maintained. How it works The lender values acceptable security and reviews the business’s ability to repay. Security can include commercial property, equipment or a wider…
Past payment difficulties can limit funding choices, but a declined application does not explain the whole position. Start by understanding the credit record and what the business can realistically afford. How it works Lenders take different views of late payments, judgments and previous financial difficulties. Some consider recent trading improvements or asset security; others will…
A revolving credit facility lets a business draw, repay and draw again within an agreed limit. It can help manage uneven receipts when there is a clear plan to replenish the facility. How it works Access is available for an agreed period and subject to the lender’s conditions. Interest usually relates to amounts drawn, but…
A merchant cash advance provides funding linked to future card takings. It may suit a business with regular card sales, but the repayment deductions need to leave enough cash for everyday costs. How it works The provider assesses card-processing history and advances an agreed amount. A proportion of card receipts is then used to repay…
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