Invoice Discounting, also commonly known as debtors financing or receivables financing is the process where businesses utilise their approved invoices submitted to their clients to receive their money earlier and unlock cashflow for various purposes.
How Does it Work
How Does It Works
The company completes its services and/or delivers its products to its clients.
The company raises an invoice to its client.
The client signs off on and accepts the invoice.
Offer to DiscountDesk
The approved invoice is offered to the DiscountDesk.
Elect to Purchase
DiscountDesk can elect to purchase the invoice for up to 80% of the value.
Paid Into Account
The amount purchased is paid into the company’s account.
DiscountDesk waits with the company for the payment from its client.
The client settles and pays for the invoice.
Capital and Fees
DiscountDesk receives its capital and fees, and the remainder is paid to the Company.
Continuous cash flow for the company.
Purchases & Discounts
Allows for larger purchases and discounts.
Creates the ability to grow the business faster.
Allows for early settlement discounts with suppliers.
Expand Without Loss
Provides an opportunity to expand without loss of control or equity.
Customers & Suppliers
Develop in better standing with customers and suppliers.
Can be utilised for urgent opportunities or emergencies.
Reduce the risk of bad debts.
How to Utilise Invoice Discounting
Scale & Expand
To scale or expand the business due to having continuous cash flow.
To pay for operational expenses whilst awaiting payment.
To negotiate discounts with suppliers for larger payments.
To pay suppliers earlier, to improve relationship and status.
To complete certain projects faster due to no delays in payments.
Manage Seasonal Fluctuations
To relieve cash flow pressure in seasonal difficulties.
Minimum turnover of R5 000 000.00 per year.
The majority of your clients/debtors should be large businesses.
The company must be trading for longer than 12 months.
The financial information of the company must be readily available.