27 August 2015

Debtor Loan & Working Capital Loan

barbed wire. working capital loan

Debtor Loan & Working Capital Loan

Invoice Finance and Factoring can be a great way to raise finance and grow your business, but what happens when you want to leave your Invoice Finance or Factoring facility but have a balance to repay?

Many businesses think that securing a term loan against your debtor book is impossible. Historically you have needed to offer tangible security and guarantees to raise term finance, but no more.

We are delighted to work with a specialist lender who will advance loan facilities secured by your debtor book.

How It Works

This product works for businesses with a track record and a level of accounts receivable (AR). Note, AR is another term for debtor book, debtors or invoices.

It works like this;

  • The ARs are insured. Underwritten by global insurance firms, the insurers carry out extra due diligence on the Borrower and the Borrower’s clients and their insurance pays out on default/late payment by firms listed on the ARs
  • The lender will loan up to 80% of the value of the ARs. Once the loan is made the ARs must be maintained at 125% of the value of the loan
  • The lender will register a ‘First Floating Charge’ at Companies House only on the Borrowers ARs
  • Personal guarantees are not normally required as everything is based on the level and quality of the ARs
  • No maximum amount of borrowing, minimum borrowing level is £100,000

Where it works well;

  • Can be used for any business purpose
  • Raising working capital
  • Replacing invoice discounting or factoring
  • Replacing bank overdrafts

Applying or Enquiring To Borrow

This type of facility is new and will not fit every business. Please get in touch so we can talk you through the best option for your business. If you want to ask any questions then contact us. You can also download the flyer via the link below.

Working Capital Term Loan

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