Single Invoice Finance, often referred to as Selective Invoice Finance, is a powerful tool for exporters looking to improve cashflow and manage their working capital. However, several misconceptions can cloud the understanding of this financing option. Let’s clarify these myths and provide a clearer picture of how Exporter Invoice Finance can benefit your business.
Myth: Single Invoice Finance is Only for Large Companies
Reality: Many believe that Invoice Finance for exporters is only accessible to large corporations. In truth, small business Invoice Financing is widely available. Whether you’re a startup or an established exporter, Invoice Financing can be tailored to fit your needs. This flexibility allows businesses of all sizes to leverage their invoices for immediate cashflow.
Myth: Complicated to Understand
Reality: Some exporters shy away from Invoice Finance due to perceived complexity. However, understanding how Invoice Financing works is simpler than it seems. Essentially, you sell your invoices to a finance provider, who then advances a percentage of the invoice value. This process can be streamlined through various invoice finance facilities, making it accessible and straightforward.
Myth: Only for Domestic Transactions
Reality: A common misunderstanding is that Foreign Customer Funding is not possible through Invoice Finance. In fact, finance for international sales invoices is a growing sector. Single Invoice Finance, also known as Export Debtor Finance, allows businesses to finance invoices from overseas customers, providing essential liquidity for international trade. This is particularly beneficial for exporters dealing with overseas projects.
Myth: Too Expensive
Reality: Many exporters assume that the costs associated with Invoice Financing are prohibitive. Whilst there are fees involved, they can be outweighed by the benefits of improved cashflow and reduced risk. Moreover, Export Debtor Working Capital can be optimised through this financing method, making it a cost-effective solution in the long run.
Myth: Same as Traditional Loans
Reality: Unlike traditional loans, which require collateral and lengthy approval processes, Single Debtor Invoice Financing allows you to access funds based on your invoices. This means you can get cash quickly without the burden of debt. Understanding what Invoice Financing is, can help exporters use it as a flexible alternative to conventional financing methods.
Myth: You Lose Control Over Your Customers
Reality: Some exporters fear that using Invoice Finance means losing control over their customer relationships. Many providers allow you to maintain direct contact with your customers and will agree a schedule of credit control activities. This means you can continue managing your relationships while benefiting from the cashflow advantages of Invoice Finance for exporters.
Understanding the realities of Single Invoice Finance can empower exporters to make informed decisions about their financing options. By debunking these common myths, businesses can better leverage export finance solutions to enhance their cashflow and support growth. Whether you’re considering Foreign Invoice Finance or looking for funding for exporters, it’s essential to explore all available options to find the best fit for your exporting business.
How Newable Commerce Can Help
Newable Commerce aims to simplify international trade for the UK’s roughly 300,000 exporting SMEs.
“Simplifying international trade” is the core principle that guides everything we do at Newable Commerce. We’re not just tackling current problems; we’re completely rethinking what trade finance means. Our goal is to fundamentally change how customers think about trade finance, proving that it can be simple and efficient, setting a new benchmark for the industry.
Newable Commerce exists to simplify international trade for SMEs. We do this through a range of products and services that enable businesses to move and manage funds internationally and optimise cash flow through our working capital debt products.
Newable Commerce offers tailored solutions for exporters looking to leverage single invoice finance effectively. We provide funding for payment terms of up to 150 days, allowing businesses to unlock working capital tied up in overseas invoices. With competitive rates starting from 1.7% per 30 days, Newable Commerce enables exporters to access up to 90% of the invoice value upfront, providing immediate cash flow to cover production costs and other operational expenses. Our expertise in export finance ensures that SMEs can navigate the complexities of international trade with confidence, whether dealing with Foreign Customer Funding or managing Overseas Debtor Working Capital. By partnering with Newable Commerce, exporters can focus on growing their business while enjoying the benefits of flexible and efficient financing solutions.
