![]() With a recourse invoice factoring facility, you are responsible for absorbing the cost of any unpaid invoices. Invoice factoring is based on the money owed to your business – but what happens if a customer doesn’t pay? Step 4: Once the factoring company has been paid in full it will pay you the remaining balance, minus a fee. The factoring company will chase any late invoice payments. ![]() Step 3: Your customers pay into a bank account that is controlled by the factoring company, so they will be aware that you are using factoring. Step 2: The invoice factoring company verifies the invoices and pays you the majority (up to 90%) of the value of the invoices immediately. Step 1: You issue an invoice to your customers and effectively “sell” these raised invoices to the invoice factoring company. After you’ve provided your customers with products or services, the invoice factoring process usually involves the following steps: Invoice factoring is when you sell control of your accounts receivable either partially or in full. You could use the funding for a variety of business purposes, such as paying wages, buying materials, repaying business finance or meeting short-term expenses. Instead of waiting 30 days or more for payment, you can release the cash almost immediately to improve your cash flow position and stabilise your revenue. ![]() Invoice factoring (also known as accounts receivable factoring and debt factoring) is a type of invoice finance that lets you access the cash tied up in your unpaid invoices. ![]()
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