Manufacturing factory

Cashflow is King

Mark Collings, Head of Invoice Finance at Santander Corporate & Commercial, discusses the benefits to businesses of accessing Santander’s Invoice Finance solution, which releases cash tied up in unpaid invoices.

Q: What is Invoice Finance?

A: Invoices can often take up to 60 or 90 days to be paid by customers, significantly restricting the ability of small to medium-sized (SME) businesses to stay on top of their cashflow and grow their businesses with pace.

Invoice Finance provides an early release of cash, typically up to 85% of the value tied up in unpaid invoices. We can usually provide finance on an invoice on the day it is raised, and Invoice Finance can also be used for export sales.

Invoice Finance can be an invaluable source of cashflow, helping businesses balance their outgoings, for example wages and supplier payments, with the receipt of cash from sales. The cash released can be used to fund expansion – perhaps a new product launch or the purchase of new equipment.

Q: Who can benefit from accessing Invoice Finance?

A: This service is primarily aimed at SMEs, and is typically relevant to those companies which have been trading for over a year, although we have funded a number of start ups. In all cases, we look to structure the facility around our client’s cashflow requirements, as one size certainly doesn’t fit all. For this reason, we offer a range of support to our clients. For smaller businesses, we can offer full factoring, undertaking day-to-day credit control and chasing debtors for payment, leaving them the time and resource to focus on their business. For larger businesses, we offer full asset based lending so, not only can we release cash against the debtors, but also against eligible stock, plant and machinery and property.

Q: What makes Santander’s Invoice Finance different?

A: Santander is very much invested as a partner in the long-term sustainability of the businesses we work with. We take time to form a relationship with customers, understand what products will suit them, and work hard to do what’s best for each individual company. In addition to dedicated Relationship Directors who look after the entire banking relationship, we have dedicated Client Relationship Managers within Invoice Finance. We don’t outsource to another provider or to a call centre – the Client Relationship Manager is a personal contact, with a direct telephone number, so a local, individual relationship can be formed.

Q: Are there complementary products which work well alongside Invoice Finance?

A: Invoice Finance complements Trade Finance very well, financing the import or export of goods, making sure they are securely transported and the finance isn’t tied up and affecting other areas of growth. It also complements Asset Finance – where we provide particular financing based on assets our customers need to acquire, such as machinery, goods, cars, and so on. We can provide Bad Debt Protection, and also Cash Reconciliation – a piece of software which automatically extracts invoice details.

For more information, please contact your local Relationship Director.

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John Carroll - Helping businesses achieve International success. Head of Product Management & International Business, Santander UK