Invoice Finance or Traditional Loans – Which is Right for Your Business?

Whether you are a start-up trying to get on top of your cash flow or a well-established business wanting to ensure that vendors are paid on time, there are two primary solutions you can turn to: invoice finance or traditional bank loans. However, there are some distinct differences between the two, and one might be better than the other depending upon your business.


That’s why the team from Selectpay has collected some important information about both the options here.


Invoice Finance


In the simplest of terms, invoice finance enables business to access cash flow immediately by getting a third-party company like Selectpay to fund their outstanding invoices. There can be a host of benefits such as:


Immediate Approval Process:

Unlike traditional bank loans, the invoice finance solution by Selectpay helps you access your unlocked cash quickly and seamlessly. The approval process takes as little as 5 minutes with no financial documentation required up to a $75k approval limit*


*Documentation required for limits over $75k


Speed & Flexibility:

With invoice finance, you’ll receive the cash you need to pay bills, process payroll, and perform other important tasks immediately. Additionally, the process offers more flexible terms than traditional bank loans.


Enhanced Cash Flow:

You’ll have immediate access to the money you need to improve your company’s cash flow, as well as scale your business should you choose to.


Traditional Bank Loans


Unlike invoice factor solutions, traditional bank loans often require some sort of collateral, such as your business assets, to receive cash. Additionally, there are often exorbitant fees involved and other disadvantages such as:


An Extensive Approval Process:

Traditional bank loan approvals often take weeks to months, making it a difficult solution for business needing to address their cash flow ASAP.

High Interest Rates & Fees:

When using a traditional bank loan, you’ll be subject to fluctuating interest rates and bank fees. Depending on the loan, often interest will be chargeable on the whole principal of the loan .


Contact us today for invoice finance solutions for small business, and more


If you’re looking for an effective way to manage your cash flow, Selectpay can help. Contact us online today for more information or call 1300 566 229.