Switching Invoice Finance Providers

If your current invoice finance facility feels expensive, inflexible or poorly serviced, you're not stuck with it. Many businesses switch providers to get a better rate, a bigger advance or simply better support. Here's how it works.

Why Businesses Switch

Common reasons include high or unclear fees, a low advance rate, a facility that hasn't grown with the business, poor customer service, or restrictive terms. As your business changes, a facility that suited you two years ago may no longer be competitive.

How Switching Works

Moving providers is a well-trodden process. A new provider typically pays off and takes over your existing facility, so the outstanding funding transfers across rather than needing to be repaid in cash. The practical steps involve giving notice to your current provider, agreeing terms with the new one and coordinating the handover of your ledger.

What to Check Before You Switch

Read the detail before committing. Check your current agreement's notice period and any termination or exit fees. Compare the all-in cost of the new facility, not just the headline rate. Confirm the new advance rate and any minimum fees. Understand the timeline so there's no gap in your cash flow.

Points to Consider

Exit fees or notice periods can reduce the benefit of switching, so factor them in. A new facility is still subject to status and the new lender's assessment. Coordinate timing carefully to avoid a funding gap. A broker can help compare the market and manage the transition.

Compare Invoice Finance Options

Think you could get a better deal? Dynesourcer can compare invoice finance providers and help you weigh up switching: https://www.dynesourcer.co.uk/mortgages/invoice-finance-sourcing

Final Thoughts

Switching invoice finance providers is often more straightforward than businesses expect, and the savings or extra funding can be significant. Just check the exit terms and compare the true all-in cost before you move.

Important information

Invoice finance for limited companies and LLPs is generally not FCA-regulated and typically falls outside the Consumer Credit Act 1974; sole traders/partnerships may have different protections. This article is not financial, legal or tax advice or a personal recommendation. Rates and figures are indicative and subject to change; finance is subject to status, eligibility and provider terms. Seek independent professional advice before entering any arrangement.