MarketInvoice continue to grow in Invoice Finance market

MarketInvoice launched their innovative way of invoice financing in February 2011 since which time they have advanced almost £35 million to almost 150 small and medium sized enterprises (SMEs). However, before we explain their successful invoice finance scheme let's just spend a few moments looking at the two main types of traditional invoice financing – Invoice Discounting and Factoring and how MarketInvoice differs in their approach. Invoice Discounting and Factoring. Running your own business, you are faced with many challenges one of which is waiting for your customer's to pay you. Whether the terms of payment are 30 days or 90 days from the date of your invoice you are certain to have had to chase up a number of your debtors who are late paying. Invoice Finance allows you get paid for these invoices in advance at a small percentage fee. There are two main types, Invoice Discounting and Factoring How Invoice Discounting works: Step 1 – You provide your customer with goods/service. Step 2 – Issue invoice to customer with a copy to the Invoice Discounting lender. Step 3 - Lender advances you up to 95% of the value of the invoices that are not paid. Step 4 –You chase and collect customer payment. Step 5 – You pay the lender fees and interest on the money borrowed. The disadvantage here is that Invoice Discounting is only open to firms with a turnover of £500,000+ and, more importantly, once you opt for an invoice finance scheme ALL your invoices have to go through it and you pay a fee on all of them, whether you need the money in advance or not. In this respect, Factoring is different. How Factoring works: Step 1 – You provide your customer with goods/service. Step 2 – Issue invoice to customer with a copy to the Factoring lender. Step 3 – Lender advances you up to 95% of the value of the invoices that are not paid. Step 4 – Lender chases and collects payments. Step 5 – Lender returns collected funds less advanced amount and interest/fees each month. While Factoring is available to all firms, even start-ups, and you can do "Spt Factoring" of just occasional invoices, the disadvantages here are that a) you outsource debt collection to a third party (i.e. the Factor) and b)  it's consequently more expensive. Borne of the respective disadvantages of each option, MarketInvoice have grown due to their innovative offering How does MarketInvoice work?

• MarketInvoice enables you to auction your long-dated invoices to institutional investors who will enter into a bidding war with one another resulting in you obtaining the best terms.
• There is no long term obligation. You only finance the invoices you want to.
• The cost is lower and there are no ongoing fees

So in summary, they marry the best of all the invoice finance options and enhance it with online technology. Indeed so successful have they been that another entrant to the market, Platform Black, have also started operations this year based on a similar model and are also growing strongly. At Choice Loans we can advise you on all your Invoice finance options and help you determine if MarketInvoice or Platform Black is right for you. To make an enquiry either complete our Invoice Finance enquiry form here or call us on 0845 1260350