The right solution for business funding NZ will vary from company to company.

However, just about all small businesses and startups in New Zealand find managing uneven cash flow to be an ongoing challenge. This can mean struggling to balance growth opportunities with ongoing operational expenditure.

One of the causes of cash flow management issues is customers taking weeks, or even months, to pay.

This leaves working capital otherwise owed to you locked up in unpaid invoices.

It’s also where Invoice Finance comes in. This flexible and customisable financial solution can help ensure your business has the working capital it needs to succeed without the risk of taking on more debt.

But is it right for your Kiwi business?

How does Invoice Finance work?

Invoice Finance gives you access to much of the value of your outstanding invoices upfront and when you need.

Typically, New Zealand businesses can have to wait 30, 60, or even 90 days for payment. With ScotPac’s tailored Invoice Finance solutions, you can access the funds owed to you tomorrow today.

How does the process work?

Invoice Finance typically functions like this:

  1. Your business provides the goods or services to your customers/clients.
  2. You issue an invoice for payment to the customer/client.
  3. You submit that invoice (or invoices) to ScotPac for funding.
  4. You receive up to 85% of the invoice’s value upfront.
  5. You receive the remaining value of the submitted invoices once the customer pays, less any fees.

Invoice financing can be set up confidentially (your customers still pay you) or disclosed (customers pay the financier directly).

How does Invoice Finance help with cash flow management?

By offering nearly immediate access to the funds owed you when you need to access it, you can ensure consistent cash flow into your business.

This gives you access to working capital to:

  • Pay for new stock and inventory
  • Meet payroll
  • Invest in new projects, market opportunities or research and development
  • Manage consistent cash flow during seasonal fluctuations
  • Improve credit rating without taking on debt
  • Actively seek growth opportunities

For Kiwi startups and growing small-to-medium sized enterprises, Invoice Finance can mean the difference between missing out on or seizing a significant business opportunity.

Want to find out more about how you can turn your unpaid invoices into accessible working capital? Call ScotPac to discuss your Invoice Finance eligibility NZ on 0800 700 032.

Is Invoice Finance the right solution for your Kiwi Business?

If you are wondering how Invoice Finance stacks up compared to alternative forms of business funding NZ, we recommend getting in touch with our team. In general, the right business solution will depend on your cash flow needs.

But Invoice Finance offers a number of benefits compared to alternatives such as business loans, lines of credit or overdraft facilities.

How does Invoice Finance vs a Line of Credit compare?

A business line of credit is good for businesses needing a flexible funding solution for accessing cash.

However, some of the disadvantages of a Line of Credit compared to Invoice Finance include:

  • Working capital access is restricted to your credit limit
  • You may need to put up property or an asset as security
  • You pay interest on funds drawn

How does Invoice Finance vs overdraft compare?

Overdraft facilities can be useful for businesses needing to cover a short-term emergency cost.

However, some of the disadvantages of an overdraft compared to Invoice Finance include:

  • Linked to and limited by an existing transaction account
  • Incurs interest and account fees
  • Can be tied to business or personal assets

How does Invoice Finance vs business loans?

Traditional loan facilities can be effective for businesses looking to fund longer-term investments.

However, some of the disadvantages of a business loan compared to Invoice Finance include:

  • Interest is incurred on the entire amount owing
  • Secured loans require collateral in the form of an asset or property
  • Stricter eligibility criteria

If you want to compare ScotPac’s various business funding NZ solutions, contact us today for a free consultation and recommendation.

How can ScotPac support your business funding in NZ?

For more than 35 years, our lending specialists have been helping New Zealand and Australian SMEs access tailored funding solutions that improve their cash flow and fuel their success.

  • Fast approval times
  • Local support specialists
  • Scalable facilities
  • Transparent fees

To join over 9,300 other businesses, we are currently supporting with business funding in NZ or to find out more about which working capital solutions can offer the flexibility in growth you need, contact ScotPac New Zealand today.

Frequently Asked Questions

What kind and size of business meets Invoice Finance eligibility in NZ?

Any business that operates business-to-business (i.e., not directly to consumers) can qualify for Invoice Finance. 

Invoice Finance eligibility NZ is not restricted to established enterprise or large companies. 

Does Invoice Finance require security?

No, it does not.  

Invoice Finance is secured against your invoices which means you do not need assets to serve as collateral. 

Is Invoice Finance suitable for seasonal, project-based or internationally trading businesses?

Yes.   

Invoice Finance is suitable for all industries and businesses including: 

  • Funding cross-border trade 
  • Industries with seasonal fluctuations in sales 
  • Project-based industries like construction 
  • Industries with longer trading terms such as manufacturing 

How much does Invoice Finance cost?

Invoice finance fees vary by lender. At ScotPac we ensure there are no hidden fees through our transparent pricing structure. The cost of Invoice Finance will depend on a few factors: 

  • Volume of invoices financed 
  • Number of invoices financed 
  • Use of Invoice Factoring vs Invoice Discounting 
  • Service fees