Large Invoice Finance Facility Secured Despite Overseas Debtors

Invoice finance solutions rarely look the same from company to company - particularly when it comes to complex cases, large deal sizes, and international debtors.

Depending on the structure of your invoicing terms and your debtors, the best invoice finance arrangement for your business can be difficult to find - you may very well need to use a specialist lender that won't be accessible to applicants not using a connected broker.

The Scenario

Our client was a manufacturing company based in London specialising in the production of vehicle handbooks. As an industry leader, they produced the handbooks for most of the main car manufacturers across Europe.

They were looking to release £2.5m from the value of their pending invoices.

However, there were a few complications:

• Most of the European car manufacturers used one single interfacing company that handled the ordering process for their handbooks.
• This meant that most of the company's invoices were issued to this single company based in Switzerland, resulting in a very high concentration of debt resting with one single debtor.
• And as this company was based overseas, it increased the risk for lenders and ruled out any high street option altogether. Lenders prefer for invoices to be UK-based and spread across multiple debtors to reduce the risk of the finance arrangement.

The Solution

We have connections to a wide range of invoice finance lenders, including those that operate in niche areas of business, and that can take a big-picture view of more complex cases.

Popular high street lenders often overlook complicated applications - they typically aren't worth the extra investment for their underwriters as they have so much 'normal' business coming through the doors as is - they can afford to be picky, and they don't generally have specialists in place with specific dedications.

We took our client's case to a reputable lender we knew could facilitate a loan with international debtors - but not before we'd applied for a bad debt protection insurance policy to safeguard against the primary overseas debtor.

It was an additional cost to the client, but a very small one considering the value of the finance they were able to secure and what those funds could do for this business in terms of growth and development.

With invoice financing, your debt book is surveyed and audited to verify its legitimacy and reliability before funds can be released - this can take a number of weeks, and is another reason why it's good to have a broker on your side to chase the surveyor and clear up any questions they may have about your business operations.

Ultimately, without using our service, this client would not have been able to secure finance - they simply didn't have the knowledge of, or connection with, the lender that was eventually able to help.