Confidential invoice factoring

Quick facts

Amount

Advance of up to 95% of the value of your invoice (your entire sales ledger)

Term

Depends on the product and on your payment terms (e.g. 30, 60, 90 or 120 days)

Cost

A weekly or monthly factoring rate of 0.5-5% of the total invoices, with higher rates for longer factoring periods, plus set-up fee (plus extra for bad debt protection)

Speed

Usually within 48 hours

Purpose of finance

To ease cash flow and to minimise late payment and debt – and to hand over credit control to your lender (albeit confidentially)

Suitable for

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 keep their factoring arrangement confidential – some providers will work with new businesses

Confidential factoring is a type of invoice finance. It offers the cash advance and credit control aspects of a normal factoring facility – but with the confidentiality of invoice discounting.

Confidential invoice factoring works on the same principle as normal factoring. You still outsource your credit control to the factoring provider. The only difference is how the lender (i.e. the factoring provider or factor) introduces themselves to your customers. With normal factoring, the provider uses their own name, whereas with confidential factoring the provider acts as your own accounting department, using your company name (and brand) when communicating with customers. If they make or take calls they do so as if calling from your business (with a dedicated phone line).

If you’re concerned about confidentiality, you might also consider confidential invoice discounting and confidential CHOCS.