Raising money from debts

This section will guide you on how to raise money for your companyA private company limited by shares incorporated and registered in England and Wales. using its unpaid invoices, which is often done to improve cash flow. You can raise money using unpaid invoices in two main ways, either by selling your business' invoices to a finance provider (by way of factoring(In finance) A financier, also known as a factor, provides money to a business by buying the business's outstanding invoices. The amount made available by the factor will equal most of the amount owed under the invoices, the balance being made available when the invoices have been paid. Unlike with invoice discounting, the factor will manage the invoices and collect the debts directly from the business's customers. or invoice discountingA financier provides money to a business by buying the business's outstanding invoices. The amount made available will equal most of the amount owed under the invoices, the balance being made available when the invoices have been paid. Unlike with factoring, the business will keep control over the collection of its invoices.) or by borrowing money and giving the lender securityAlso known as a debenture, charge or mortgage, security over an asset or assets (such as cash, debts, real estate or equipment) is given by a borrower (and sometimes a third party such as a shareholder of the borrower) to a lender in case the borrower fails to make a payment due. Security is also used to refer to a personal guarantee of a borrower's payment obligations to a lender, typically given again by a shareholder and sometimes secured over the shareholder's personal assets. In the event of a borrower's failure to make a payment due to a lender, the lender will have the right to sell any asset secured or call in the guarantee. over your unpaid invoices. This section will help you to work out which option is best for you, and whom you can approach to raise money.