Cost effective Debtor Finance solutions
Commercial Point Finance have the experience to source quality cost effective ‘Debtor Finance’ solutions from a number of specialized lenders. Take the fuss out of chasing your debtors and leave it our team to assist in freeing up your cash flow. This will enable you and your business to capitalize on opportunities and focus on growing your business.
What is Debtor Finance?
Debtor Finance is a generic description of a funding process, based on the value of a business’ accounts receivable ledger. If your business supplies products or services to other businesses on standard trade credit terms, you can use Debtor Finance to grow your business.
It is also sold as:
- Invoice Discounting
- Cash Flow Finance
- Asset Finance
- Invoice Finance
- Working Capital finance
How does Debtor Finance work?
Security requirements for Debtor Financing vary between lenders, but traditionally focus on the value of the debtors ledger, specific assets and or a charge or mortgage over the business, along with the personal guarantees of directors are often used as collateral for this finance facility.
By focusing on the value and collectability of the accounts receivable ledger, most debtor finance credit lines will automatically increase in response to increases in sales, and provide ongoing working capital to fund the growth of the business. Typically the advance rate ranges from 70% of accounts receivable ledger value up to 90%. The remaining 30% to 10%, known as the ‘retention’ is released following receipt of payment of each invoice by the customer/debtor/buyer.
Check out our Commercial Finance Page for all our commercial finance options.
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