Invoice Finance allows small and medium sized enterprises (SME) to unlock the cash owed to them in unpaid invoices and access tomorrow’s payments today.

However, for many businesses, the thought of customers knowing about their use of a financial facility is concerning. Reputations can take years to cultivate, and so SMEs may not want their customer base knowing about their tight cash flow and jumping to conclusions.

If you’re a business owner worrying about whether your customers will find out, ScotPac is here to help you understand everything you need to know about confidential Invoice Finance.

Explore Invoice Finance today.

Will Your Customers Know You Are Using Invoice Finance?

Confidential Invoice Finance does exist. With the right facility, you can maintain control over what your customers know and don’t know.

For exporters and importers in particular, where larger and more consequential key accounts can impact cash flow, confidential Invoice Finance provides additional reassurance and confidence in their funding solution.

What is confidential Invoice Finance?

There are two sub-forms of Invoice Finance.

  • Invoice Factoring. This is when your funding provider, such as ScotPac, manages your accounts receivable and debt collection directly. It means that the arrangement is not confidential and your customers will be aware of your use of Invoice Finance.
  • Invoice Discounting. This is the confidential form of Invoice Finance. Your business retains full control of and responsibility for collecting due payments from customers. But it means that the funding arrangement remains private.

Why should you use Confidential Invoice Finance?

Invoice Discounting allows you to access working capital tied up in unpaid invoices while your customers remain unaware of the arrangement.

For SMEs and businesses with a robust accounts receivable department or strong debt collection processes, Invoice Discounting allows you to continue dealing with your customers in a way that is completely ‘business as usual’.

ScotPac’s confidential Invoice Finance facility includes:

  • Advance access to up to 85% of the invoice value
  • Access to working capital fast, often within 24 hours of submission
  • Scalable facility sizes, up to $200 million, to grow with your business
  • Secured facility against outstanding invoices with no property security required
  • Complete control over your customer relationship

How does Confidential Invoice Finance work?

A confidential Invoice Finance facility works in the same way as other forms of Invoice Finance.

  • You deliver the goods or services to your customers and issue an invoice with standard trading terms.
  • You submit the invoice to ScotPac and receive the majority of its value within 24 hours.
  • You continue to follow up on payment from your customer.
  • You receive payment from your customer as normal.
  • ScotPac releases the remaining balance to you once the invoice is settled.

Why do Exporters and Importers Often Choose Confidential Invoice Finance?

For businesses trading across borders, or even domestically, confidentiality in their use of a financial facility may be important.

For some importers and exporters, it is better for their ongoing trade relationships to keep their use of Invoice Finance confidential so that the entire funding chain is invisible. It helps to avoid trade partners jumping to conclusions and making assumptions that are either inaccurate or unhelpful.

ScotPac’s Trade Finance facility is always operated in conjunction with an Invoice Finance facility, so funding is in place on both sides of the business cycle.

Does your Business need Confidential Invoice Finance?

For many SMEs, confidentiality is the reassurance they need as a growing business. However, it may not be necessary for everyone.

If you are concerned about your customers finding out and that concern is holding your business back from unlocking the working capital it needs to grow, then a confidential Invoice Finance arrangement may be the answer.

A confidential facility removes that concern entirely. It allows you to take advantage of Invoice Finance’s benefits, from fast funding to scalable access to working capital, without any impact on your customer relationship.

How do you compare Invoice Factoring vs Invoice Discounting?

Invoice Factoring - non-confidential
Invoice Discounting - confidential

Are your customers aware? 

Yes, they may be. 

No, they are not. 

Who is responsible for collecting outstanding invoice payments? 

Your funding provider, e.g., ScotPac 

You are. 

Who is best suited for this type of Invoice Finance? 

Businesses without an accounts receivable team/process 

Businesses with an accounts receivable team/process 

Find out more about how confidential Invoice Finance can help businesses manage cash flow.

Contact ScotPac to find out more about confidential Invoice Finance

For over 35 years, our team has been helping SMEs access the business and commercial finance solutions required to get needed funding fast. With over 9,300 businesses being supported currently and $26.3 billion in invoice funding each year, there is no one better for helping you find the tailored financial solution to fuel your success.

Enquire about confidential Invoice Finance today.

Frequently Asked Questions about Confidential Invoice Finance

Can my overseas customers or suppliers find out I’m using Invoice Finance if I have a confidential facility?

No. ScotPac’s confidential facilities can extend to international trade transactions. Speak to our team of lending specialists today about how we can tailor your solution so overseas your buyers/suppliers are not aware of the arrangement.

How is a confidential facility structured?

The structure of your facility depends on factors such as your business size, risk profile and how you prefer to manage collections. Disclosed, non-confidential facilities can suit businesses without a dedicated accounts team.

For a consultation on the right facility structure for your business, speak to a ScotPac lending specialist today.

What happens if a customer accidentally sees a reference to the facility on a bank statement or remittance advice?

At ScotPac, we can structure our Notice of Transfer and payment details to appear under your own business name and letterhead. This minimises any risk or chance of a customer noticing that a third-party funder is involved.

Can a business be too small or too new to qualify for a confidential facility?

No. If you qualify for Invoice Finance, you can be eligible for a confidential facility. Eligible businesses must:

  • Sell goods or services to other businesses on standard trade credit terms
  • Have been trading for a minimum of 6 months in operation
  • Be able to demonstrate consistent invoicing and collections
  • Generate at least $10,000 in invoices per month

Can I change from an Invoice Factoring facility to a confidential Invoice Discounting facility later on?

Yes, you can. Some SMEs do transition between facility types. Whether this is due to business objectives changing or even their internal accounts receivable capability improving.

We recommend speaking with a ScotPac lending specialist to confirm the right facility structure and the right timing for your business’s needs.

Cash Flow and Invoice Finance: Frequently Asked Questions

How much funding can I access?

ScotPac Invoice Finance provides funding up to $200 million, and the facility grows with your business rather than being fixed at a limit set last year. A specialist will size a facility against your debtor book. 

Will my customers know I am using Invoice Finance?

It depends on the facility structure. Some arrangements are disclosed to your customers and others are not. Discuss which suits your customer relationships with a specialist. 

Is Invoice Finance the same as Invoice Factoring or Debtor Finance?

These terms are used interchangeably across the Australian market. They all describe funding released against your outstanding invoices, with differences in how collections and disclosure are handled. 

Do I need to finance every invoice?

Not necessarily. Facilities can be structured across your whole debtor book or more selectively. A specialist will explain which options apply to your business. 

Do I need property security?

No. Invoice Finance uses your unpaid invoices as collateral, so no property or other assets are needed as security. It is one of the key reasons growing businesses choose it. 

How quickly can I access funds?

ScotPac states funds can be available in as little as 24 hours once your facility is approved. If you are working to a deadline, say so in the first conversation. 

Can Invoice Finance be used alongside other facilities?

Yes. It is commonly run alongside other ScotPac solutions, and ScotPac’s Trade Finance facility is always operated in conjunction with an Invoice Finance facility. 

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