How to Prevent Late Payments & Overdue Invoices Hindering Business Growth
There are many things in life that are painful, but in business, there is nothing quite like the annoyance of completing a piece of work, sending over the invoice and then waiting for it to be paid.
According to research from Barclay’s, almost three in five (58%) small or medium enterprises (SMEs) across the UK are currently waiting on late payments from customers, increasing to more than nine in ten (94%) medium sized businesses. According to research from ICAEW, UK businesses are currently owed outstanding payments totalling £23.4bn.
This obscene amount of money owed to businesses, means that the backbone of our economy, (our SME community), is providing over £23bn of free credit to its customers, causing cash flow issues for businesses.
In this article, we unpack how your business can deal with late invoice payments through invoice finance, and how Hydr can help you to recover your overdue invoices payments.
How to deal with late invoice payments through invoice finance
Whilst the issue of overdue invoices continues, invoice finance can enable SMEs to be paid not only on time, but far earlier than the payment terms set out on their invoices. One of the key reasons why companies have healthy looking Profit and Loss but poor bank balances is precisely this – the time it takes to actually get paid has a detrimental effect on one of the most important elements of company health, its cash flow.
Invoice finance is an extremely effective instrument to enable companies to be paid within a couple of days (or as little as 24 hours) of their invoices being raised, closing the gap between delivering the product or service to your customer and receiving the cash for doing so. This removes the strain on cash flow caused by overdue invoices for businesses.
How Hydr can help you to recover your overdue invoices
Hydr finances your overdue invoices, ensuring you can continue your business operations without worrying about whether you have sufficient cash flow.
At Hydr, we believe we have developed the purest form of invoice finance, something we call Advanced Invoice Payment:
- We fund 100% of the value of the invoice, for which we charge a fixed fee. The balance you receive in one lump sum
- The fee, once charged, does not change, even if your debtor is a little late in making payment
- We are a disclosed product which means that we manage collections on your behalf, thereby saving you valuable time
- Our product is completely digital: Sign up takes around 15 minutes and managing the account is paperless
- Cutting-edge technology ensures we can make funding decisions in real time
Overdue invoices and late payments are major issues in the UK which are going to take a long time to address. Whilst this poses critical challenges for businesses, invoice finance is a transparent, cost effective way to optimise your cash flow and save you valuable time managing your overdue invoices.