The Top 10 Invoice Financing Companies in the UK 2023

Are you a UK-based business looking for the fastest, most flexible funding going? Look no further – we’ve reviewed the country’s top 10 invoice finance providers below, so you can decide which one’s right for you.

A healthy cash flow is essential for the success of any business. But spending too much time chasing payment for goods or services can distract you from other important tasks.

The answer? Invoice finance.

Invoice finance gives your business a helpful cash injection by freeing up money from unpaid invoices the moment they're raised.

Invoice financing companies pay up to 95% of the total value of an invoice, usually within 24 hours. They can take full control of your sales ledger to ensure debts are settled promptly and in full, or let you retain credit control, in order to maintain the confidentiality of the service. In return, you’ll pay a small percentage fee. But how do you choose between lenders? The only way is to compare.

So, what are you waiting for?

The best invoice financing companies in the UK 2023

We reviewed the UK’s foremost invoice financing companies – including those specialising in factoring, discounting, and bad debt protection – to help you choose the best invoice finance provider for you.

According to our research, the best invoice financing companies are MarketInvoice, GapCap, Skipton Business Finance, Metro Bank SME Finance, RBS FacFlow, Bibby Financial Services, Sonovate, Aldermore Invoice Finance, Close Brothers Finance, and Novuna.

The best invoice finance providers in the UK are:

Read on to find out why, or dive straight into the good stuff and receive invoice financing quotes tailored to your business’s needs, today.

Simply complete our quick, quote-finding questionnaire with a few details about your business’s annual turnover, industry, and how long you’ve been trading for. We’ll use your responses to pair you with one or more of the UK’s leading invoice finance suppliers – providing they meet the requirements you’ve specified.

If our algorithm says there’s a good match, the right invoice finance provider(s) will be in touch directly, offering quotes and advice that are completely tailored to your business.

It’s free to try, and your business just has to be based in the UK to be eligible.

1. MarketFinance

Best for its straightforward, user-friendly approach

For one, MarketFinance offers selective invoice finance – a solution which allows you to receive funding on just one invoice, rather than your whole ledger. This service is completely confidential.

Entirely confidential invoice discounting is also available, though the eligibility criteria is more stringent – see the table below for more.

Unlike many of the other invoice finance providers here, MarketFinance doesn’t offer invoice factoring – just discounting. It does offer confidential credit control as an add-on, although this is provided by a third-party company called Veritas Commercial Services. Utilising this add-on increases your fees, but loosens the prerequisites in terms of your turnover and trading history.

Bad debt protection (here called ‘Credit Insurance’) is also available as an add-on for an extra cost, and is supplied by third-party provider Euler Hermes.

Regardless of the facility you select, you must be registered as an LLP within the UK or Ireland.

The company is also on the cusp of launching fast business loans of up to £250,000. If you’re in the market for this – rather than a more versatile, ongoing form of credit – then watch this space! Or, in the meantime, check out our complete guide to the best small business loans in the UK while you wait.

2. GapCap

Best for its spectacular customer reviews

If your business’s cash flow needs are short-term – and you want a contact-free, ad hoc approach to releasing value from your invoices – GapCap’s selective invoice finance should be your first port of call.

Alternatively, if you’ll require more regular, consistent access to funding, GapCap’s flexible invoice discounting facility will be more up your street. It’ll allow you to unlock funds either from the entirety of your sales ledger, or just a handpicked selection of debtors alone.

GapCap also offers a form of finance that’s tailored to businesses in the supply industry, with each package tailored to the needs of the specific enterprise.

And we haven’t even got to the best part yet – GapCap’s Trustpilot rating. To be brief, its ‘Excellent’ rating – 4.9/5 from 79 reviews at the time of writing – is the best we found among the UK’s leading invoice finance providers. Top class!

3. Skipton Business Finance

Best for its interest-free invoice finance

It’s fast, too. You’ll be eligible for finance against your invoices as soon as you submit them, and Skipton promises to pay up within 24 hours. You’ll receive up to 90% of the invoice’s value in a quick cash injection, and Skipton will advance anywhere between £25,000 and £5 million in funds.

Unlike several other of the invoice finance providers listed here, Skipton also offers invoice factoring that’s entirely interest free. You won’t pay any setup fees either, and it’s also available to new businesses – a rarity for many lenders. Here’s what you’ll pay:

As a Skipton invoice finance customer, you’ll also get access to a relationship manager, who’ll walk you through your bespoke package and answer any questions you may have. Should we be surprised Skipton boasts an almost flawless 4.6/5 rating on Trustpilot?

Nope – least of all because of Skipton’s flagship confidential solution, ‘My White Label’, is so wonderfully effective. When you use it, Skipton’s team will provide both the finance and the credit control. However, they’ll use your company’s logo and branding while they chase up your invoices, so your customer will have no idea that you’re using a finance facility!

Essentially, ‘My White Label’ combines the best of both worlds. It handles all the admin and hassle that comes with chasing clients – as a factoring service does – but, like a discounting facility, comes with all the benefits of a confidential facility.

To utilise Skipton Business Finance’s confidential invoice discounting facility, you’ll need an annual turnover of around £100,000.

4. Metro Bank

Best for its zero cancellation penalties

Metro Bank offers three main invoice finance facilities: factoring, discounting, and funding tailored to small businesses. This last one is ideal if your enterprise is in the early stages of its growth, and comes with just a single, transparent cost. There are no discount fees, while Metro Bank also does away with the setup charge, and scraps any minimum costs going forward.

With Metro Bank’s small business-oriented invoice finance solution, you can access a funding line of up to £100,000.

But what we love most about Metro Bank’s approach is its surprisingly forgiving cancellation policy. In contrast to many other invoice finance providers we reviewed – which can be quick to penalise any attempt to leave a contract early – Metro Bank charges no cancellation fees. Instead, it just asks for 28 days' notice – seems reasonable, right?

Right. And, with dedicated invoice finance teams based at Basildon, Guildford, and Sheffield, Metro Bank offers some solid in-person, email, and phone-based support, too.

5. RBS FacFlow

Best for its dedicated, high quality customer support

Still, there’s plenty of things to love about having a relationship manager – for starters, that you’ll receive excellent customer service. As it turns out, this is one of RBS’s strong points. As well as robust phone and email-based support and a glut of online resources, RBS – being a popular high street bank, of course – also has an array of branches that you can visit for expert invoice finance advice.

So, what can you expect from the facility itself? Well, similar to many other invoice finance providers in the UK, RBS promises to release up to 90% of the value of what you’re owed, in as little as 24 hours.

RBS also offers a separate product – asset based lending. As the name suggests, this service allows you to release cash from your business’s existing assets – rather than your invoices. As the prerequisite of a £6.5 million annual turnover suggests, it’s best-suited to larger businesses – particularly those looking to free up cash flow for an acquisition, or rapid growth.

As the table shows, RBS’s invoice factoring and discounting facilities are the most accessible – particularly for businesses with a smaller turnover. However, these thresholds are still higher than the £100,000 turnover prerequisite other providers – such as MarketFinance and Skipton Business Finance – demand.

If you’re not quite at that stage of your business’s journey just yet, you may be better off looking elsewhere.

You're halfway through our list of the top 10 best invoice financing companies for UK businesses. Time to start comparing quotes?

Simply hit one of the buttons below to start our quick questionnaire. It takes just 30 seconds to complete, and by telling us more about your business’ specific requirements, we can help ensure that you receive the best, most personalised invoice finance rates and recommendations.

It’s completely free for UK-based operations, and we’ll only use your data to match you with the relevant invoice finance providers. Happy researching!

6. Bibby Financial Services

Best for unlocking 100% of your invoice's value

You don’t pick up all those awards without offering a wide range of invoice finance products. So what can Bibby bring to your business? Here’s a list:

• Invoice factoring
• Invoice discounting
• Construction finance
• Recruitment finance
• Export finance

Bibby also offers an invoice finance package that’s tailored to the needs and pain points of small businesses. It’s called ‘Forward Finance’, and is available for business owners with a turnover of less than £300,000 per year.

If you opt for this package, you’ll be able to release up to 90% of your invoice’s value within 24 hours. You’ll also enjoy a £50,000 pre-approved funding limit and zero setup fees, plus the option to add protection from bad debt, and to request an additional credit management service.

Selecting Bibby’s factoring and discounting services – or its solution for recruitment agencies – will mean you can unlock up to 100% of your invoice’s value.

7. Sonovate

Best for recruitment agencies

For all these reasons and more, Sonovate is amongst our top invoice finance picks for recruitment agencies – or, more accurately, it is our top pick!

With Sonovate, you can release up to 100% of your invoice’s value within a day. The support’s brilliant, and – unlike basically every other invoice finance provider we’ve found – bad debt protection is included as standard (usually it costs extra).

And, while most invoice finance providers in the UK offer some form of online back office portal, Sonovate’s is one of the rare breeds that’s actually a pleasure to use. Slick, colourful, and bursting at the seams with user-friendliness, you can check in on the status of your funding, 24/7 – from wherever in the world you happen to be.

Plus, an ‘Excellent’ Trustpilot score of 4.7/5 (from 132 reviews) must mean Sonovate is doing plenty right!

8. Aldermore Invoice Finance

Best for its range of flexible, industry-specific funding options

Aldermore offers both invoice factoring and discounting facilities, as well as an asset based lending service for larger enterprises. You can expect to receive up to 90% of your ledger’s value, paid out in a quick cash injection within 24 hours.

There’s also a range of industry-specific funding options on offer, including trade finance, contract finance, and invoice finance for construction businesses. While what your business is eligible for will vary, Aldermore’s funding limits are between £100,000 and £1 million.

Your business will need to have an annual turnover of at least £250,00 to be eligible for Aldermore’s invoice factoring and discounting funding solutions.

9. Close Brothers Invoice Finance

Best for medium-sized to large businesses

Close Brothers' close attention to detail extends to its customer relations, too. A dedicated ‘client manager’ will liaise with you regularly to ensure you’re getting the most out of the relationship, and resolve any issues that may pop up along the way.

But back to the finance.

In addition to other asset-based forms of finance, Close Brothers also offers an invoice discounting facility. Here, the requirements for businesses are a bit more stringent – you’ll require an annual turnover of at least £500,000 to be considered.

Bad debt protection is available for a fee, and – as with most of the UK invoice finance providers that made the list – your funds typically arrive within the day.

You’ll also be able to access funding 24/7 via ‘IDeal’. It’s a cloud-based platform that integrates with most accounting software packages on the market, saving you time, money, and hassle by automatically reconciling your invoice payments.

10. Novuna

Best for transparency and a small business-friendly approach

These include invoice factoring, invoice discounting, and optional credit protection, plus tailored solutions for specific industries, such as recruitment.

To be eligible for Novuna's invoice finance facilities, your business will need to be turning over around £50,000 per year.

Novuna promises to release up to 90% of your invoice’s full value. How much you’ll be eligible for – and the amount you’ll pay in fees – depends on your business’s turnover, as well as the average length you typically have to wait for payment.

As well as being upfront about its costs – something the invoice finance cost calculator on its site also attests to – Novuna is refreshingly flexible when it comes to contracts. You’ll start off with a six-month trial period, followed by a monthly rolling deal. It’s little wonder Novuna comes away with a glowing 4.7/5 (or ‘Excellent’) score on Trustpilot!

FAQs

Am I eligible for invoice finance?

How does invoice financing work?

What is the difference between invoice financing, invoice discounting, and invoice factoring?

Throughout this article, you’ll have seen different terminology used to describe the various processes the umbrella term ‘invoice finance’ encompasses.

There are, quite frankly, too many of them to be unpacked here, so let’s focus on the two that matter most: invoice factoring and invoice discounting.

While both facilities are means of securing credit against your unpaid invoices, there are a couple of key differences between them, and we’ll give you a hint as to the biggest: credit control.

Invoice factoring

Let’s get technical for a second. When you engage an invoice factoring company for finance, they actually purchase your invoices outright.

Because the nature of this agreement means the lender effectively ‘owns’ your ledger, it allows them to deal with your clients directly. This means the lender is legally entitled to chase your clients up for payment, and – essentially – handle all your business’s credit control.

Invoice factoring may also be recourse or non-recourse. Non-recourse agreements (also known as a form of bad debt protection) mean that, in the event that your customer is unable to pay (for instance, they become insolvent or declare bankruptcy), you won’t be eligible for paying back the loan.

Again, this is only possible in a factoring agreement because the lender has ‘bought’ your invoices off you. In other words, the responsibility for its ultimate repayment lies with them – not you. In an invoice discounting agreement, however the finance provided against your invoice is only ever a loan – meaning it always needs to be paid back!

Invoice discounting

If you want to keep things confidential – that is, you don’t want your customers to know that you’re utilising third-party finance – you should opt for an invoice discounting facility.

Invoice discounting agreements allow you not only to retain the responsibility of chasing your unpaid invoices, but to keep a tighter leash on your business’ sales ledger, too. It’s also cheaper than factoring, as you’re not paying for the additional credit control services that those companies provide.

One more thing – with invoice discounting, your customer will continue to pay you directly. Conversely, if you’re using a factoring company, your client will pay directly to the lender, and you’ll receive the remainder of the invoice’s value (minus the fees, of course) from the invoice provider themselves.

And remember, invoice finance is an umbrella term. It encapsulates invoice factoring, invoice discounting, and several other related forms of finance, too.

Hope that makes sense! If not, feel free to drop a line to rob.binns@expertmarket.co.uk to ask any further questions you might have about factoring, discounting, finance, and what the differences between them all are.

How much does invoice financing cost?

When it comes to factoring, there are two central charges to consider: the discount fee, and the service fee.

The discount fee is usually a percentage of the invoice you’re seeking funding for. It works in the same way as the charges you’d pay for a bank loan, or overdraft.

Usually, the higher the value of the invoice you’re applying for finance for, the lower this fee will be – so it’s almost always better value to release funds from bigger invoices.

Discount fees typically stack up in the range of 0.5% to 5% of your invoice’s value.

The service fee is a regular administration fee charged on a monthly or weekly basis by many (but not all) providers. Rather than being calculated against the value of your invoices, this cost is worked out as a percentage of your business’s annual turnover.

Service fees for an invoice factoring agreement will typically come in at anywhere between 0.75% and 2.5% of your turnover. For discounting agreements – which, as you’ll remember, are cheaper than their factoring counterparts – you can expect to pay in the region of 0.2% to 0.5%.

You’ll also have to shell out extra for any add-on services that aren’t included with the facility as standard. The most common of these is the charge for bad debt protection (or a non-recourse agreement), which safeguards you from having to foot the bill should one of your debtors go bust.

Bad debt protection will normally cost you between 0.5% and 2% of your annual turnover.

Will my customer know if I’m using an invoice financing company?

The answer is: they don’t have to. The best factoring companies – such as Skipton Business Finance – offer a completely confidential service, where they chase payment under your company name and branding.

Plus, while credit control is a key function of invoice factoring, it doesn’t have to be so with invoice discounting. Some invoice finance solutions won’t come with a credit control service at all – meaning you’re free to chase your own invoices, and retain autonomy over your hard-won customer relationships while you’re at it.

If keeping factoring a secret from customers is important to you, be sure to mention this early on in your negotiations with providers.

How do I compare the best providers?

It’s a good question, and one we can solve for you – right here, right now!

Because, to compare the UK’s best invoice financing companies, all you need is to provide us with a few details about your business’s needs. To get started, hit one of the buttons below to answer the first question in our quick quote-finding questionnaire.

We’ll ask:

• Whether you’ve used invoice factoring before
• What industry your business operates in
• How long (roughly) you’ve been trading for
• What type of customers you have
• Your expected annual turnover this year

We’ll also require your postcode, so we can check whether your business is eligible for quotes, and to match you only with the most relevant invoice finance suppliers servicing your area.

Once you’ve completed the form, we’ll do just that, matching you with one or more of the UK’s leading suppliers – but only if they’re the right fit for your unique needs and specifications. These invoice finance providers will then be in touch with quotes and advice tailored to your business.

The whole process is free, and the form takes just 30 seconds to complete. Our service is also available to all businesses based in the UK. Why not give it a go?