Also called: Debtor finance, Confidential invoice discounting
Invoice discounting
Invoice discounting is a facility where a financier advances a percentage of the value of your outstanding invoices while your business continues to manage its own collections and customer relationships. It is usually confidential to the customer.
What is an invoice discounting?
Invoice discounting is a facility where a financier advances a percentage of the value of your outstanding invoices while your business continues to manage its own collections and customer relationships. It is usually confidential to the customer.
Example
A business draws 80% against a $500,000 debtor ledger, receiving $400,000 and collecting from customers as normal.
Why it matters
It funds growth without adding a lender into your customer conversations, but it requires strong internal credit control.