Businesses historically tended to rely on a bank overdraft to provide the working capital they needed. In recent years however, a variety of invoice finance arrangements have become increasingly popular. Invoice finance differs from an overdraft - it is not strictly a loan at all but an advance paid on a company’s outstanding invoices. As a leading independent invoice finance provider.

A recent UK survey of SMEs showed that 88% of those questioned still had an overdraft. However, most commentators now agree that the total sum lent though bank overdrafts is rather less than the total sum now being provided by the invoice finance industry. This is hardly surprising when you realise the overdraft facility of those surveyed represented just 2.6% of the money owed to them by debtors.

None of those surveyed reported an increase in their overdraft; 39% reported a decrease and 11% said their overdraft had been taken away. This is scary and possible because overdrafts are repayable on demand i.e. overnight! You need to know where you stand and with our contracts you get 6 month’s notice if repayment is required. This is not something we would do lightly and without talking to you about it first but you then have time to organise alternative support.

Our factoring services typically carry a charge of 1.0% of turnover but of those surveyed 77% assumed the charges would be far greater than this. Our invoice discounting services typically carry a charge of 0.5% but of those surveyed 100% expected to pay much more, with 67% of them assuming charges 2.5 times greater than the actual fee.

Invoice finance is rapidly becoming the funding option of choice for many more SMEs. Ultimate has become the provider of choice — we’ve been the industry’s fastest growing company for the past three years; that’s because we’re a well recognised name that offers very flexible contracts and outstanding levels of customer service. We’re also totally professional and utterly reliable.