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Fund what you choose

Selective invoice finance: funding on your terms.

Sometimes you do not need a whole-ledger facility. Selective invoice finance, sometimes called spot factoring or single invoice finance, lets you fund particular invoices or customers when it makes commercial sense.

Discuss your optionsHow we work

Commitment

Invoice by invoice, or customer by customer

Suits

Occasional, seasonal or project cash-flow needs

Flexibility

High

Cost per invoice

Often higher than whole-ledger facilities

What selective is

Selective facilities let you decide which invoices to put forward for funding. You might fund a single large invoice from a new contract, a particular customer who always pays slowly, or a run of invoices ahead of a seasonal peak. The rest of your ledger is left untouched.

Because there is usually no whole-turnover commitment, selective facilities can be a useful way to handle occasional pressure without signing up to an ongoing arrangement. The trade-off is that the cost per invoice tends to be higher than under a whole-ledger facility.

How selective works,
step by step

  1. 01

    Identify the invoice

    You choose which invoice or customer account you would like to fund.

  2. 02

    Provider assesses it

    The provider reviews the invoice and the customer's creditworthiness before agreeing an advance.

  3. 03

    Funds released

    An agreed proportion of the invoice value is advanced to you.

  4. 04

    Settlement

    When the customer pays, the provider releases the balance less their fee. There is no obligation to fund the next invoice.

Who it tends to suit

  • Businesses with occasional rather than constant cash-flow gaps
  • Firms winning large one-off contracts
  • Companies that want to trial invoice finance before committing
  • Businesses with one or two slow-paying customers

Potential advantages

  • Control over what you fund

    Only the invoices you choose are financed. There is no requirement to route your whole ledger through the facility.

  • Lower ongoing commitment

    Selective facilities typically avoid the minimum fees and notice periods associated with whole-ledger arrangements.

  • A way to test the water

    Some businesses use selective finance to see how invoice finance fits before moving to a fuller facility.

Things to consider

Invoice finance is not right for every business. These are the points we talk through before anyone approaches a provider.

  • 01

    Higher unit cost

    Flexibility comes at a price. If you find you are funding most invoices most of the time, a whole-ledger facility is usually more economical.

  • 02

    Customer quality matters more

    Providers assess each invoice on its merits, so funding depends heavily on the creditworthiness of the customer in question.

Selective questions

  • The terms are often used interchangeably. Spot factoring generally refers to funding a single invoice; selective invoice finance can also describe facilities where you fund chosen customers on an ongoing basis. The principle is the same: you choose what to fund.

  • Often, yes. Many selective facilities involve the provider verifying the invoice with your customer and collecting payment directly. Confidential selective facilities exist but are less common.

  • Most providers set a minimum invoice size for selective funding, and it varies. We can help you understand where your invoices are likely to fit.

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