Businesses that want finance and outsourced credit control
Invoice Finance · UK limited companies
Invoice Factoring
Invoice factoring combines funding against eligible unpaid B2B invoices with provider-managed sales-ledger and collections support. NBS Finance is a UK commercial finance broker and introducer: we review your debtor book and the support you need before identifying a suitable starting route.
NBS Finance is a broker and introducer, not a lender. An enquiry does not guarantee an offer.
From completed invoice to customer payment
Hypothetical illustration, not a quote: a £50,000 eligible invoice at an assumed 80% advance supports £40,000 before extra reserves or charges. When the customer pays, the provider applies receipts against the funded balance; the remaining invoice value is released after contractual fees and adjustments. A dispute or overdue debt can instead reduce availability or require repayment.
The factoring provider normally operates the agreed collections service. NBS clarifies the requirement and coordinates an introduction; it does not collect your customer debts or approve credit limits. Agree customer-contact wording, collection escalation and your own responsibilities before starting. Compare service fees, discount charges and minimums with the operational support included.
Quick answer
When invoice factoring may fit your business
Growing B2B sales creating a cash-flow gap
A debtor ledger with eligible completed invoices
Provider assessment
What providers assess in a factoring enquiry
A provider reviews the business and debtor book, including invoice eligibility, customer concentration, payment history and disputes. The available amount depends on its assessment and the eligible ledger, not simply the total value invoiced.
- Aged debtor and creditor reports
- Sample invoices, contracts and proof of delivery
- Customer concentration, disputes and payment history
Important:
Customers are normally aware of factoring. Availability and advance levels depend on the provider and debtor book.
Process
How an invoice-factoring enquiry progresses
Tell us the amount, purpose and timing.
Share the documents relevant to this route.
NBS clarifies the requirement and possible route.
A suitable provider completes its own checks and sets any offer terms.
Decision check
Compare factoring availability, costs and collections
| Question | Why it matters |
|---|---|
| Which invoices and customers will the provider fund? | Check eligibility, customer credit limits, concentration caps and disputed or overdue invoices. |
| What is the total cost at your expected sales and drawings? | Compare the service fee, discount charge, minimums, additional fees, security and exit terms. |
| Who collects payments and handles disputed or unpaid invoices? | Agree customer contact, collection responsibilities and what happens if an invoice is not paid. |
| Does the facility provide enough usable headroom? | A headline limit is not cash available. Review eligible debt, advance levels, reserves and existing drawings. |
Factoring questions
Will customers deal with the factoring provider?
Normally the provider handles agreed ledger/collection functions and customers are aware of the arrangement. Check invoice notices, contact standards and complaints handling.
Does factoring insure every unpaid invoice?
No. Recourse and bad-debt protection are different contractual questions. Protection can have limits, exclusions and claim conditions; disputes and performance failures are not automatically covered.
What does the service fee include?
Request the collections, reporting and credit-control tasks included, plus minimums and additional charges. Compare the same service when reviewing offers.
Could retaining collections suit us better?
Compare invoice discounting where internal controls support it. Discounting does not itself guarantee confidentiality.
Factoring costs and the alternative
Ask for the service fee for ledger and collections support, the discount charge on funds used, and any arrangement, minimum-use or exit charges in the proposed agreement. Check the full cost and obligations rather than comparing a single advertised rate. Our invoice-finance costs guide explains what to ask. For a substantial debtor book, read about large invoice-finance facilities. If you already have funding, review switching invoice-finance providers and the notice, settlement and transfer considerations.
With invoice discounting, the business normally keeps day-to-day credit control. Factoring may be worth reviewing when you want collections support as well as funding against eligible B2B invoices. Compare both in our factoring versus discounting guide.
Further reading and scope
This page is general commercial-finance information, not legal, tax or accounting advice. Read the relevant official guidance at www.british-business-bank.co.uk.
NBS Finance primarily supports UK limited companies. NBS Finance is not incorporated as a limited company and is not authorised or regulated by the Financial Conduct Authority. Where applicable, NBS works with lenders and intermediaries that are FCA-authorised for their own regulated activities; their status does not make NBS Finance FCA-authorised.
Discuss your invoice-factoring requirement
Start with monthly B2B invoicing, the aged debtor book, customer spread and the funding you need. Include any existing facility and the collections support you want. Best estimates are fine.
Start your funding enquiry