What are the Best Invoice Finance Companies in the UK?
Are you searching for the best invoice finance company in the UK?
The invoice finance market has grown dramatically in recent years as the popularity of factoring and invoice discounting has soared.
Little more than a decade ago, there were only around 10 invoice finance providers in the UK. The lack of competition in the industry resulted in high prices and poor service levels, which gave the industry a bad name and made it a finance method of last resort for many businesses.
Thankfully, now all that has changed. At the end of 2017, the total value of invoice finance and asset-based lending in the UK stood at £22.2bn, up 5 percent on the funds advanced the year before.
The value of invoice finance lending to small businesses alone (those with an annual turnover of less than £500,000) increased by a staggering 19 percent year-on-year, with advances worth £833 million.
Get a Market Leading Invoice Finance Quote
Which UK Invoice Finance Company is Best?
As the popularity of invoice finance has increased, so has the number of providers competing for your business. There are now more than 50 invoice finance companies in the UK.
The increased level of competition has brought down the costs, drastically improved service levels and made invoice finance a viable option for many UK businesses.
Of course, since all businesses are different, each borrowers situation will require a unique solution. Some lenders are best for speed, others for customer service, others for current rates.
As with any compelling offer, you need to due your due diligence on the fine print, or simply ask us for help. We have a lot of experience with alternative finance and can help you find the lender right for your situation.
Our Selection of the Best Invoice Finance and Factoring Companies in the UK
With so many invoice finance providers competing for your business, it can be difficult to know where to start. So, we’ve put together a guide to some of the best invoice finance providers to help you consider your options.
*All figures are accurate at the time of writing (December 2018).
Bibby Financial Services
- Advance rate – up to 100%
- Minimum client turnover – Approx. £100k
- Discount fee – 1-3.5%
- Service fee – 0.5-3.2%
Operating since 1982, Bibby Financial Services has worked with more than 7,000 businesses and earned a reputation as one of the UK’s leading invoice finance providers. With a minimum turnover requirement of just £100k, it is accessible to small businesses and has a particular reputation for working with construction and recruitment firms.
In 2017, Bibby won the coveted ‘Best Factor and Invoice Discounter’ at the National Association of Commercial Finance Brokers Awards. It also has a four-star rating on the online review site Trustpilot – an impressive score given that it’s one of the largest independent invoice finance providers in the world. It’s also very accessible with a 24/7 client online service and 19 local offices around the UK and Ireland.
Market Invoice
- Advance rate – up to 90%
- Minimum client turnover – Approx. £100k
- Discount fee – 0.3-1.5% for 30 days
- Service fee – 0.2-3.2%
Founded in 2011, MarketInvoice is a relatively new entrant to the market but it has already established a reputation for being one of the best providers in the industry. It offers a wide range of invoice discounting solutions available to small and medium-sized businesses on a whole turnover, selective (you pick and choose the invoices to raise money against) and confidential basis.
MarketInvoice also has a simple online platform to reduce your admin requirements and it provides a straightforward breakdown of costs with no hidden fees so you know exactly what you’re paying for. And, with a 9.4/10 rating on Trustpilot, it must be doing something right!
Skipton Business Finance
- Advance rate – up to 90%
- Minimum client turnover – Approx. £300k
- Discount fee – None
- Service fee – 2-3.5%
With a higher turnover requirement than some of the other providers we’ve looked at, Skipton Business Finance provides a service for growing businesses looking to free up cash-flow. As well as displaying its fees on its website, something not all providers do, Skipton also scraps the discount fee altogether to make it easier to calculate exactly how much you’ll have to pay. That fee also decreases in line with your turnover. Unlike some other providers, there’s no option for a confidential service, which means your customers will be aware you’re using a finance provider.
Ashley Finance
- Advance rate – up to 90%
- Minimum client turnover – Approx. £50k
- Discount fee – 1.5-4%
- Service fee – 1-3%
With a minimum turnover requirement of just £50k, Ashley Finance provides a legitimate finance solution for startups and micro-businesses that need to free up capital to grow. As well as providing finance for businesses with a poor credit history, Ashley Finance also gives clients the option of a confidential service, which is unusual for a factoring provider. The costs are also fixed and transparent, so you’ll know exactly how much you’re paying right from the off.
Metro Bank
- Advance rate – up to 85%
- Minimum client turnover – Approx. £100k
- Discount fee – 1.5-3.5%
- Service fee – 1-3%
If you need to free up cash-flow in a hurry, Metro Bank promises to review your invoice finance application within an hour, and if approved, you can have funds in your account within 12 hours. It also gives customers access to a full range of invoice discounting and factoring services, so you can find the right fit for your business. Importantly, there’s also no cancellation penalty if you decide invoice finance is not the right product for you.
One of the main benefits of the service provided by Metro Bank is the expert credit control service it provides. That allows small businesses that use the factoring service to concentrate solely on running their business without having to worry about collecting payments from their customers.
Aldermore Invoice Finance
- Advance rate – up to 90%
- Minimum client turnover – Approx. £60k
- Discount fee – 1.5-3.0%
- Service fee – 0.25-3%
Aldermore is a relative newcomer to the industry having been founded in 2009. In that time, it has picked up 21 awards for services and innovation as well as being named the ‘Invoice Finance Provider of the Year’ at the Credit Today awards.
Aldermore caters for a broad range of businesses in industries such as import, wholesale, construction, haulage, recruitment and manufacturing. Aldermore approves 9 out of 10 applications, which makes it a popular choice for businesses that may have been refused factoring services elsewhere. It also assigns a relationship manager to every client to tailor a best-fit financial solution that meets your business’s needs.
Close Brothers Invoice Finance
- Advance rate – up to 90%
- Minimum client turnover – Approx. £250k
- Discount fee – 2.5-3.5%
- Service fee – 0.5-2%
Close Brothers is one of the relatively few providers in the industry that clearly outlines its fees online, although the exact fees you pay and the advance rate will differ from business to business. Close Brothers offers both invoice discounting and factoring services to small and medium-sized UK firms and will consider businesses with 30-day plus payment terms. It also offers bad protection insurance as a bolt-on to protect you against invoices that your customers don’t pay.
Hitachi Capital UK
- Advance rate – up to 85%
- Minimum client turnover – Approx. £50k
- Discount fee – 0.45-4%
- Service fee – £250 fixed
Hitachi Capital, which is one of the UK’s largest factoring providers, caters for businesses of every size, from startups with a turnover £50k to multinationals with an income of £10 million. It offers a confidential factoring service on a six-month trial period so you can sample the service and leave without notice. It also simplifies the service for small businesses, charging a fixed £250 fee along with a percentage of the sales invoice value. Hitachi’s reputation for high levels of customer service and the simple pricing structure is a benefit for many smaller companies.
