Up to 95% of the value of your unpaid invoices (your entire sales ledger)
Depends on the product and on your payment terms (e.g. 30, 60, 90 or 120 days)
A percentage of the invoice value (rate will vary according to your business profile, the lender and the length of the loan) plus set-up fee
Usually within 48 hours
To ease cash flow and to minimise late payment and debt
A broad range of businesses with B2B invoices (e.g. seasonal businesses, those with occasional large projects and those with just a few debtors) who want to continue with their own credit control processes – lenders require a minimum trading history and minimum turnover
CHOCs (‘Customer Handles Own Collections’) is a hybrid of invoice factoring and invoice discounting. It’s a disclosed (non-confidential) facility, like factoring, but with a CHOCs facility you continue to handle your own credit control, like invoice discounting.
With a CHOCs facility, you chase your customers for payment and use your own credit control processes, which is why also known as ‘Customer Handles Own Credit Control’ or CHOCC. In this way it’s similar to invoice discounting.
The key difference is that your customers pay the invoice finance provider rather than you. So it’s usually disclosed. (There is however a variant known as confidential CHOCS.)
CHOCs might be a good option if:
Like all invoice finance, a lender will release up to 95% of the value of your invoices. The remaining 5% will also be made available when your customers pay.
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