There are many myths surrounding Invoice Finance. Even though it is a great way for a business to keep control of its cash flow by securing funding against their outstanding invoices. So, to ensure you don’t miss out on this simple and effective method of funding, due to the misconceptions that exist around it, we have compiled a short list of myths surrounding invoice finance and shown how they compare to reality.
Myth 1: “It’s expensive”
It seems to be that the most common myth about invoice finance is that it must be expensive. It is assumed that because it is about flexible and fast funding solution that can be used at any time, that it must come at a premium. The reality is that this form of business finance is no more expensive than any other. It can actually turn out to be cheaper, due to the shorter term nature of funding.
Myth 2: “You’ll chase my customers for payment”
Another misconception is that customers will be contacted for payment and will learn that their debt has been “sold on”. This is what no business wants, as it can ruin a relationship and trust that the business has worked so hard to build. This isn’t something we do at Peak Cashflow, as we allow you to keep full control of your customer/client relationships.
Myth 3: “I don’t need it, my business isn’t in trouble”
Yes, we do help businesses that are experiencing a cashflow problem but we also provide a finance option to allow businesses to grow in an affordable and easy way. Invoice finance can allow a business to prepare for a busy time of year or allow them to secure cash flow to take on new projects.
Myth 4: “My whole sales ledger will need funding”
A number of businesses only want funding for certain invoices. Especially for those customers that demand longer payment terms or constantly pay late. Many providers can ask you to finance your whole ledger but some providers can provide you with selective invoice finance. This allows you to have the full flexibility of using the service as and when you need to.
Myth 5: “I’ll be forced into a long contract”
We provide bespoke finance options for our clients to ensure they get the right for their business. Some providers can ask you to sign a long contract. But it ensure that you shop around and get the right fit for you and your business.