What is Confidential Invoice Discounting?
The service called Confidential Invoice Discounting provides you with funding against your outstanding sales invoices but you collect in your invoices so your debtors don't know you are using the service.
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How Does Confidential Invoice Discounting Work?
Confidential Invoice Discounting (also known as CID), is an invoice finance product whereby a discounting company (a discounter) will provide you with up to 90% of the value of your outstanding sales invoices e.g. with outstanding unpaid sales invoices on your sales ledger of £240,000 you could receive an initial cash injection of over £200,000. In some cases we can also help you access overpayments that could release further funding.
Invoice Discounting is similar to debtor factoring but the financier does not become involved with the management of your sales ledger or the day-to-day chasing of your debtors for payments. The facility will release working capital from the funds that are tied up in unpaid invoices within your sales ledger and this will improve your cash flow.
The discounter will then continue to provide you with up to 90% (this figure may be higher in some cases - contact one of our advisers to see if your business would qualify) of the value of new sales invoices, normally within 24 hours of you raising them. You will receive the balance of the invoice value, less the discounters charges, once it is paid.
With confidential invoice discounting you retain control of your sales ledger and the facility is completely confidential, so that your customers don't know that the discounter is involved. You retain all the contact with your debtors and so your relationships with them remain unaffected.
How Much Cash Could You Raise?
Find out how much cash you could raise with our free invoice discounting online cash calculator.
What Does Confidential Invoice Discounting Cost?
There are two types of charge, administration fee (to cover the cost of monitoring the risk) and discount charge which works in a similar way to interest on a loan. Examples of Costs for Confidential Invoice Discounting.
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Bad Debt Protection
If you are concerned about bad debts, we can introduce you to a discounter that will also provide you with bad debt protection this can also be called Protected Invoice Discounting or PID. For information about the cost of confidential invoice discounting please click on the link below or contact us for quotations.
Further Resources and Information
Below are some case studies that you may find helpful:
Case Study - Confidential Invoice Discounting
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For further information about Factoring follow this link
For further information about Invoice Discounting follow this link
