Lloyds Bank Invoice Factoring Review
Lloyds Bank Commercial Finance is one the UK’s top providers of Receivables Finance and Asset-Based Lending. Since 1962, they have operated as a part of Lloyds Banking Group, and are currently supporting around 10,000 UK businesses, from startups to multinationals.
Lloyds takes a unique, specialist approach to their funding solutions that include Invoice Factoring, Invoice Discounting, and Asset-Based Lending. They offer solutions for many industries such as agriculture, healthcare, recruitment, and construction.
Their head office is located in Banbury, Oxon, with regional offices throughout England and Scotland.
So, let’s get started with our review of Lloyds Bank Invoice Factoring.
Lloyds Bank Commercial Finance is a member of the Finance and Leasing Association, and is a trusted Invoice Factoring provider for UK businesses. In 2016, they reported a Total Income of £15.4 billion, with a further £817 billion in assets.
Lloyds Invoice Factoring offers:
- Support for domestic and international trade
- Industry expertise
- Commitment to clients
- Small business-friendly solutions
- Flexible contracts
Lloyds also offers you a dedicated Client Manager, who can give you sector-specific advice and tailor a solution to match the needs of your business.
Lloyds Bank Invoice Factoring Costs and Fees
Lloyds are fully transparent with their costs and fees, indicating that they vary with the products and services you choose as part of your agreement. You will face basic costs such as service fees, and may also incur other charges like an international payments fee, same-day payments fee, or handling fees for Lloyds to process your debtor payments that are done via credit or debit card.
Lloyds Bank Commercial Finance Products and Services
Lloyds offers multiple Invoice and Asset Finance solutions for all types of businesses. What’s great is that you don’t need to hold an account with Lloyds, in order to still have access to their products and services.
Their solutions aims to improve your cash flow, increase your sales, and help you purchase the necessary equipments for your business. Lloyds business financing solutions are divided into 4 categories: Invoice Factoring, Invoice Discounting, Asset-Based Lending, and Asset Finance. They also offer bad debt protection for businesses with an annual turnover of at least £200,000.
Lloyds Bank Invoice Factoring
Lloyds Bank Invoice Factoring allows you to immediately access up to 90% of your invoice value within 24 hours. Lloyds uses your invoice ledger as the primary security for the cash advance, and collects the repayment at a later date from your clients. The entire Invoice Factoring process is easily managed via Lloyds’ online platform, which makes everything incredibly quick and convenient.
Lloyds Invoice Factoring is available for businesses with credit terms of up to 90 days, and an annual turnover of at least £50,000, which is remarkably lower than typical Invoice Factoring providers that normally require a minimum of £250,000.
Additionally, Lloyds offers Bad Debt Protection for businesses with annual turnovers of £200,000 or more.
Lloyds Bank Invoice Discounting
Lloyds Bank Invoice Discounting is another Invoice Finance solution that enables you to receive up to 90% of your invoice value, if your business has an annual turnover of at least £250,000. The entire process remains confidential to your clients, and you have full control of your credit management and collections process.
Lloyds requires that your business has a well-established credit control and sales ledger management system, to ensure that you can efficiently handle collections and are protected from credit risks.
Lloyds Bank Invoice Discounting is managed via an online platform, which gives you the ability to send invoice details and check your funding availability at all times.
Debtor Protection is an incredibly useful feature for Lloyds’ Invoice Finance services. It’s relatively low-cost, easy to manage, and protects your business against potential bad debt if your customers fail to pay their invoices.
Debtor Protection protects up to 90% of your invoice value (excluding VAT), and can be used for both domestic and international trade. The overall cost of Debtor Protection ranges from 0.20% to 0.85% of your annual turnover, and depends on your business size, sector, and customer base.
You are eligible for Debtor Protection if your business has an annual turnover of £200,000 or more. If you quality, you’ll be able to claim a 30-day trial with no contractual obligations.
Lloyds Bank Asset-Based Lending
Lloyds offers Asset-Based Lending as a solution to release working capital tied up in your assets such as stock, plant and machinery, as well as property. These assets will be used as security against your loan.
This solution is only available for businesses with annual turnovers of at least £10 million, as they tend to have higher-value assets.
Lloyds Bank Asset Finance
Lloyds offers two solutions within Asset Finance: Hire Purchase and Finance Lease. To be eligible, your business must be based in the UK and have an annual turnover of £100,000 or more.
Hire Purchase means that Lloyds buys the asset you need, which you can use after making an initial deposit to them. You’ll be able to have full ownership of the asset when all the rental payments have been made.
Finance Lease allows you to rent an asset, such as machinery, without having to purchase it at the end of your contract. Lloyds buys the asset you need, and leases it to you for regular rental payments over a period of time. These payments will typically cover the cost of the asset plus interest. At the end of your rental period, Lloyds sells the asset, and you receive the majority of the sales proceeds.
Lloyds can purchase a wide range of assets for you, such as plant and machinery, vehicles, agricultural equipment, construction equipment, and medical equipment.
Lloyds Bank Commercial Finance Customer Support
Lloyds Bank offers excellent Customer Support to both their clients and the public. You can speak to a customer representative by telephone from Monday to Friday during normal business hours, or by requesting a callback. Alternatively you can also write to Lloyds or visit one of their regional offices in England and Scotland for an in-person meeting with a local specialist.
As a client, you are assigned a dedicated Client Manager who can offer sector-specific experience and expert advice to improve the functionality of your business, and help manage your credit control.
You also have access to a convenient and customizable online platform where you can access your accounts, payments, and reporting across multiple currencies.
Lloyds Bank Invoice Factoring Contracts
Lloyds offers remarkably flexible Invoice Factoring contracts in comparison to other major financial institutions.
Initially, you can receive a 6-month trial, and have the option to request a refund of the service fee if you’re dissatisfied with your experience.
What’s more, for the first 6 months of your contract, you can terminate your Lloyds Bank invoice factoring contract without incurring any associated fees as long as you give them 28-days notice.
Lloyds Bank Commercial Finance Reputation
Lloyds has an impressive collection of case studies that demonstrate their past successes with UK businesses. Their solutions have produced incredible results such as increased sales, business expansion, and improved cash flow.
Currently, there aren’t enough online reviews about Lloyds Bank and their Invoice Factoring solution to reach a solid consensus. But, it’s clear from their eligibility requirements and flexible contracts that Lloyds is open to working with a wide selection of businesses, including businesses with low annual turnovers.
Comparing Lloyds Bank Invoice Factoring
Lloyds is one of the top providers of Invoice Factoring in the UK. Their offerings are comparable to other large organizations and financial institutions such as Barclays, RBS, Bibby, and Skipton. The table below compares Lloyds Bank invoice factoring against some of the other leading providers.
|Invoice Factoring Providers||Lloyds Bank||Barclays||RBS||Bibby Financial Services||Skipton Business Finance|
|Cash Advance||Up to 90%||Up to 90%||Up to 90%||Up to 100%||Up to 90%|
|Time to Receive Funding||Within 24 hours||Within 24 hours||Within 24 hours||Within 24 hours||Within 24 hours|
|Annual Turnover||Min. £50,000||Min. £500,000||£250,000 – £6.5 million||Not specified||Not specified|
|Contract||6 month trial followed by tailored contract||Varies||Varies||Unlimited, rolling contract||3 month trial, with no obligations|
|Bad Debt Protection||Offered||Offered||Offered||Offered||Offered|
Lloyds is considerably more transparent and small business-friendly than Barclays or RBS. Their minimum requirement for annual turnover is much lower, and they are more open about their fees and contracts.
Should You Use Lloyds Bank Invoice Factoring?
Lloyds is an solid option for Invoice Factoring in the UK. Their solutions are small business-friendly, and their contracts can be tailored to match your needs. Lloyds can offer you valuable industry experience and expertise in sectors including transport, recruitment, agriculture, and manufacturing.
Your business can also benefit from Lloyds’ mentorship programme that provides over 450 enterprise mentors to new or established SMEs. You’ll receive specific advice on areas such as how to improve your business’ functionality, cash flow issues, and business expansion.
Lloyds Bank Invoice Factoring
Lloyds Bank Commercial Finance is a popular choice for Invoice Factoring in the UK due to their flexibility and transparency. They prioritise customer service and tailored solutions, in order to maintain long-term client relationships and support business growth. Apart from Invoice Factoring, they also offer other solutions like Invoice Discounting, Asset-Based Lending, and Asset Finance.
If you’re looking to work with a company that can give you expert advice and a wealth of resources, Lloyds is a great option because of their commitment to being client-focused and small business-friendly.
If you’re interested in finding out more about Lloyd’s Invoice Factoring or receiving a quote, be sure to reach out to a customer representative either by phone or post.