What's the difference between factoring and invoice discounting?
While factoring is generally available to companies with a turnover of £50,000 or above, invoice discounting is generally intended for larger businesses with a turnover of £500,000 or more.
With factoring, the factor is in charge of sending the bill to your clients and customers, however with invoice discounting you retain control over that area of your business.
With invoice discounting, as you are responsible for sending out receivables and other credit management issues, the provider will require a greater level of oversight and information about your business model than you will need to show to a factoring service provider.
As you still send out your own bills, invoice discounting requires less work on the financer’s part. Therefore, it is generally less expensive than factoring.