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Close Brothers Invoice Factoring Review

Close Brothers are one of the foremost merchant banks in the UK, with a range of funding services to suit all shapes and sizes of business. Established in 1878, their total assets are worth almost £8bn, making them one of the most highly trusted banking services in the world.

Invoice Factoring Features

Because the types of businesses that employ factoring services are diverse, each contract, and subsequent fees, can differ wildly. The more diverse the options, the better it is for the business as flexibility is vital, particularly in relation to lengthy contracts. Close Brothers provide an impressive range of factoring features, including:

  • Up To 90% Advanced
  • Bad Debt Protection
  • Relatively Low Turnover Requirement
  • Export Factoring
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Summary
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Up To 90% Advanced

Once you have sent the factor an invoice, a percentage of its value is made almost immediately available. Although the 90% that Close Brothers offer is not universal for all their customers, it is very much at the higher end of the scale for those who are offered it.

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Bad Debt Protection

There are two types of invoice factoring available through Close Brothers, recourse and non-recourse. With non-recourse factoring the factor takes on liability for the debt, offering enormous peace of mind to their clients. While this is much rarer of the two types, due to the risk involved to the factor, it can be hugely beneficial for those that qualify for the service.

Relatively Low Turnover Requirement

Apart from a few specialists that focus on start ups and small businesses, there is usually a minimum annual turnover limit that needs to be met before the service can be accessed. Close Brothers clients need only an annual turnover of £250,000, which is considered quite low in comparison to many other providers.

Export Factoring

One of the main advantages of employing Close Brothers is their ability to process export invoices. As most invoice finance facilities are not able to provide export invoice payments, this feature is of huge advantage to some. What’s more, non-recourse factoring, where the factor takes on the liability of the debt, is made available with export inclusive contracts, although this is not universally applied.

Fees

As with all factors, fees can vary hugely depending on the amount of funds processed and the risk involved to the factor. While most providers are not particularly forthcoming with the fees involved with factoring, Close Brothers give a broad, if not detailed, outline of the types of fees incurred with their service.

Smaller businesses, in this case those with under £500,000 annual turnover, can expect to pay up to £600 per month, medium sized under £1,000 and Large businesses as much as £1,400.

As is typical practice with factoring, larger businesses pay less of a percentage on income than smaller ventures. This is partly due to reduced risks and higher profitability for the factor. Businesses with a turnover of under £2m, for example, will pay as much as four times the rate as those with over £2m turnover.

Best Suited Clients

Some factors provide bespoke facilities to suit specific sizes of business, with some designed specifically for start ups. Although Close Brothers invoice factoring cannot be accessed by those with less than £250,000 annual turnover, that is still a relatively small amount that many SME are able to qualify for.

Close Brothers provide a range of services to suit the needs of their clients but they are particularly beneficial to established medium to large businesses who need fast access to cash flow, typically for further investment.

The broad non-recourse factoring service is one of the most highly regarded in the industry and well suited to businesses of international scope, especially those who do not employ in-house financing staff to deal with the complex nature of client insolvency. This can be particularly complex when dealing with contracts across borders.

In short, Close Brothers are a trusted and reliable financier, providing a cost-efficient service that allows their clients to access funds with the minimum of fuss.

Support

Because they provide a transparent service that is easily understood and encompasses all the requirements those seeking factoring services require, it is rare that issues arise for their customers.

It is important, however, that when problems do occur, the factor offers support as and when is needed. With offices all over the country and two support lines, one for new enquiries and one for existing customers, Close Brothers ensure they are there to help. This is in conjunction with an E-mail service, for which they endeavour to reply promptly.

While some services offer a 24 hour helpline, Close Brothers do have a reputation for dealing with problems in an efficient manner, receiving consistently high reviews for their entire support service.