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What is Invoice Discounting and Financing?

What Advantages Does Invoice Discounting Bring?

Invoice discounting and financing offered by Bajaj Finserv is a financial service that lets businesses avail finance by keeping its bills receivables as collateral. Get the funding after discounting a percentage of receivables which secures it against any possible bad debts. It is an asset-based solution to meet funding requirements for working capital. Businesses can receive an advance on cash due from their customers through us, thus, making it an effective financing solution.

Keep the receivables bills of your business as security and repay the credit when you receive cash from your customers. You can opt for online invoice discounting for the ease of availing.

A credible borrower can avail up to 90% of the total bills receivable amount and get immediate access to finance. Alternatively, opt for a long term loan in the form of Loan Against Property from Bajaj Finserv. Get access to a large sum of money up to Rs. 3.5 crore and fund your business with the necessary capital. Complete infrastructure development, equipment purchase, business expansion and such other big budget investments with this amount. It comes with easy-to-meet loan eligibility criteria.

The instant funding option comes with several benefits like –

  • Way to secure funding without the need to keep other assets as collateral
  • Brings solution for issues related to slow payment
  • The amount availed can be used to either increase business’ cash flow or provide it with the necessary capital for growth
  • As your turnover increases, you become eligible to avail higher funding based on your receivables
  • You can also receive essential guidance from experts at our lending institution for managing business finance.

Also Read: What is Factoring

Who to Avail this Invoice Financing?

The option to purchase invoice discounting is open to any business that sells goods or services to customers with credit terms ranging between 30 and 90 days. Usually, companies operating in the following areas utilise it the most.

  • Manufacturing
  • Construction
  • Wholesalers
  • Courier service operations

However, its accessibility is not limited to these, and any goods or services provider can avail finances through invoice discounting.

How Is Discounting Different from Factoring?

While financing through invoice discounts is a viable option, the confusion of invoice discounting vs factoring remains. The primary point of difference in factoring vs discounting is the incidence of receivables’ collection and sales ledger control.

In discounting, the responsibility of collecting debtor balance and sales ledger control lies with the business availing it. Factoring, however, shifts the collection responsibility and control of sales ledger to the lender. Whether you opt for one or the other depends on the credit amount needed and the size of business. Both factoring and bill discounting are convenient financing methods.

Additional Read: What is Loan to Value in Mortgage Loan?

Capital equipment leasing is another mode of financing to utilise. With this, lease financing institutions fund equipment leasing which you can retain possession of through lease payoff. Use it to install capital equipment for your business.

To get a high valued credit that gives you long tenure for repayment, opt for a loan against property from Bajaj Finserv. Use Loan Against Property EMI Calculator to estimate your monthly outflow towards the loan repayment and plan your finances effectively. Fill up the online application form and get approval within 48 hours following quick disbursal.