A comparison Between MarketInvoice and Platform Black for Invoice Finance

The peer-to-peer lending market has grown substantially during the last two years. Although initially concentrating on personal and then business loans, this innovative form of finance is now available in the invoice finance market.

The two leading companies to enter this competitive marketplace were MarketInvoice and Platform Black, both doing so in 2011, with the former being the first to commence trading. They have already taken the Invoice Financing sector by storm but are there any differences between them? We thought it would be useful to do a comparison from the perspective of an SME in the UK.

Both MarketInvoice and Platform Black provide a similar invoice financing auction service to small and medium size enterprises (SME) that brings together all the good things about the above two traditional methods. However, the MarketInvoice / Platform Black comparison reveals that both companies offer the following advantages:

• As a number of institutions bid for your invoices in an auction you are more likely to achieve a bigger initial sum and a lower discount than with traditional invoice finance schemes.
• Your costs can be kept low by auctioning as little as one invoice.
• A business of any size or age can auction their invoices.
• Your sales ledger stays under your control so your debtors do not need to know of MarketInvoice or Platform Black.
• There are no contracts, funding limits or arrangement fees.

So, what differences are there between both MarketInvoice and Platform Black? We note the following:

• Platform Black works on an auction basis with the invoice being sold to the best bidder. MarketInvoice used to do this but changed in 2014 to operate on a fixed price basis. They set the terms of the invoice for sale (in agreement with the seller, of course) and buyers either buy or don't.
• As a result of their different funding methods MarketInvoice is usually slightly more expensive.
• However the benefit with MarketInvoice that offsets its expense is that things happen much quicker and with more certainty. In fact, if invoices are large enough (over £200,000 in a lifetime) then the Market Invoice rates fall dramatically and they compete on price with Platform Black.

In our opinion this MarketInvoice / Platform Black comparison shows that there is merit in both companies schemes and there is certainly room in the market for both.

So, if this review has got you interested, why not contact one of the experienced team here at Choice Loans as we have built up an excellent working relationship with both companies and can answer any detailed questions you may have. You can either speak with one of our Advisors on 0845 1260350 or complete our Invoice Finance enquiry form here.