Advance of up to 95% of the value of your invoice (usually a large invoice with a value more than $45,000)
Depends on the product and on your payment terms (e.g. 30, 60, 90 or 120 days)
A percentage of the invoice value (rate will vary according to the lender, your business profile and the length of the agreement) plus set-up fee. Selective invoice discounting is usually more expensive on a per invoice basis than whole ledger facilities
From 24 hours to 2 weeks
To finance specific (large) invoices rather than your entire sales ledger (in order to ease cash flow and to minimise late payment and debt)
A broad range of businesses with B2B invoices (e.g. seasonal businesses, those with occasional large projects and those with just a few debtors)
Selective invoice discounting is a type of selective invoice finance, i.e. a way of borrowing money using your unpaid invoices. It’s similar to spot factoring in that it allows you to finance specific invoices (or customers). The key difference is that your customers are not usually aware you are using invoice discounting, whereas with factoring, the lender will take over credit control for your customers.
Selective invoice discounting, like spot factoring, allows you to unlock finance by selling specific unpaid invoices at a discount to a lender in return for a cash advance. You are not handing your entire sales ledger over to a lender ? as you would be with confidential invoice discounting or factoring).
This can be useful if you take large orders from one customer, but your other invoices are smaller or irregular. By using selective invoice finance you can get advances for your large invoices, leaving the smaller ones unaffected.
As with all types of invoice financing, your cash advance is a percentage of each invoice’s value. Once your customer has paid an invoice, the lender pays you the remaining balance minus their fee.
With both selective invoice discounting and spot factoring, the individual invoices you choose to finance don’t have to be from the same customer, you decide which ones you finance and which ones you choose to handle yourselves.
Unlike factoring, invoice discounting allows you to you keep control over your sales ledger and client relationships. It’s confidential.
How does selective invoice discounting work?