Smart Invoice Financing
Invoice Financing or Bill Discounting is a short-term borrowing facility that allows businesses to unlock funds tied up in unpaid invoices. By selling or discounting receivables, companies gain immediate access to working capital without waiting for customer payments.
Types of Invoice Financing / Bill Discounting
Invoice financing solutions are designed to help businesses improve liquidity and manage cash flow efficiently
Invoice Discounting
Businesses borrow against unpaid invoices while retaining control over collections.
Bill Discounting
Banks or financial institutions purchase trade bills at a discount to provide instant funds.
Recourse Factoring
The business bears the risk of customer non-payment, keeping costs lower.
Non-Recourse Factoring
The lender assumes credit risk, protecting the business against customer default.
Confidential Invoice Financing
Allows businesses to raise funds against invoices without informing customers.
Export/Import Bill Discounting
Special facility to support exporters and importers by financing international trade bills.
Why Invoice Financing is Important?
Improves Cash Flow
Provides immediate liquidity without waiting for invoice maturity.
Supports Business Growth
Ensures uninterrupted working capital for expansion and operations.
Reduces Credit Risk
With non-recourse options, businesses are protected from customer defaults.
Maintains Healthy Operations
Helps businesses pay suppliers, employees, and other expenses on time.
FAQs
How is invoice financing different from bill discounting?
Invoice financing is a broader term covering various financing against receivables, while bill discounting specifically refers to advancing funds against trade bills.
Who can use invoice financing?
Small, medium, and large businesses that extend credit to customers can avail this facility.
Is collateral required for invoice financing?
Generally, no separate collateral is needed since invoices themselves act as security.
How quickly can funds be accessed?
In most cases, businesses can receive up to 80–90% of invoice value within 24–72 hours.