Invoice Discounting

Invoice discounting is a form of asset-based finance. The company cedes its receivables book to us as collateral for the loan. The loan is effectively repaid from the funds collected from receivables.

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Working Capital Finance

Working capital is the money you use to manage your day-to-day operations. Small businesses sometimes need loans to meet their daily operations needs until their earning assets are sufficient to cover their working capital needs. We often lend short-term money to small businesses to enable them to get off the ground and grow. As the business grows and their own assets enable them to earn money, they can repay the working capital loan to the bank. Working capital loans may have higher interest rates than, for example, real estate loans since banks consider them riskier.

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Bridging Finance

Bridging loans are designed to help companies complete the purchase of a property before selling their existing property by offering them short-term access to money. As well as helping home-movers when there is a gap between the sale and completion dates in a chain, this type of loan can also help someone planning to sell-on quickly after renovating a home or help someone buying at auction.

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Bridging loans are designed to help companies bridge the gap between a concluded transaction from which income is to be derived and the point in time at which the funds appear in the company’s bank account. Example: The company has sold a property; completed a project or rendered a service at a given date but, due to any number of reasons they only receive the funds 60, 90 or even 120 days later. If the company would like to use the fund due from that transaction before the physically received it raise bridging finance.

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To obtain such funding the company is required to know exactly how you’ll be paying off the loan. This means the company will be able to tell us what funds it will be used to pay off the loan from the outset (the company’s exit plan). Such loans are usually settled within a few months. 

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Purchase Order Finance

A purchase order is an order form, issued by a buyer to a seller. When it’s accepted by the seller, it’s an agreement between buyer and seller on prices and quantities for a product or service. This type of finance provides funding for businesses with purchase orders to pay their suppliers and smooth out cash flow. It is an effective and popular option for those businesses which need a quick and effective way to finance their purchase orders by alleviating cash flow pressure caused because the business needs large funds to pay its suppliers to produce the goods for the order, a payment which is usually required prior to supplier production and also because the customer usually has lengthy payment terms for the product they are receiving.

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Inventory Finance

Sometimes companies can negotiate an attractive discount from their suppliers should they pay their inventory on delivery. In instances where the discount negotiated is greater than the cost of the loan, taking out a loan could turn into an income-generating opportunity. In other instances, especially where a business is seasonal in nature (particularly retail businesses) purchasing most of their inventory prior to the “peak season” makes a lot of sense. These loans are generally short-term in nature and companies usually pay them off after the “peak season” is over with the proceeds of sales from their seasonal sales. 

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The terms of your inventory financing agreement will typically be determined by how quickly you expect your inventory to sell. If you expect the inventory to turn over quickly, it would make sense to have a shorter loan term. Conversely, if you expect the inventory to take a while to sell, longer loan terms make sense. Because of this variance in loan terms, it is especially important for you to take into consideration the total cost of the loan before agreeing to any inventory loan contract.