Invoice Finance Solutions UK 2026: The 7 Types and Which You Need
UK invoice finance solutions fall into seven main types: whole-turnover factoring (all invoices funded, customers know), confidential invoice discounting (all invoices funded, customers do not know), selective or spot factoring (pick which invoices to fund), export factoring (multi-currency for overseas customers), construction-specific (CIS, retention, adjudication), recruitment-specific (pay-and-bill, IR35, AWR), and supply chain finance also called reverse factoring (set up by the buyer, supplier opts in). The right solution depends on turnover, sector, customer mix, and whether you want customers to know you are using a financier. This page covers each type and routes you to the right UK providers.
Director, Market Invoice
Oliver leads Market Invoice's editorial and comparison research. With a background in UK commercial finance, he oversees provider analysis, rate verification, and industry reporting across all verticals.
Last reviewed: 1 June 2026
The 7 invoice finance solution types
1.Whole-turnover factoring
All your B2B invoices funded, provider collects payments and chases customers. Customers know about the financier. Cheapest cost per invoice but commits the whole sales ledger.
When it fits: Established SMEs with steady debtor book, willing to outsource credit control, want the lowest cost per invoice.
Common UK providers: bibby, close-brothers, aldermore
2.Confidential invoice discounting
Same as whole-turnover but customers do not know. You continue collecting; provider funds you against the ledger. Suits established businesses with good credit control.
When it fits: Larger SMEs (£500k+) with good credit control already in place who want the funding without telling customers.
Common UK providers: close-brothers, skipton, aldermore
3.Selective or spot factoring
Pick which individual invoices to fund. No commitment to the whole ledger. Pay-per-invoice pricing. Most expensive per invoice but most flexible.
When it fits: Businesses with occasional cashflow gaps, one-off large invoices, or that need a try-before-you-buy alternative to whole-turnover.
4.Export factoring
Multi-currency facility for invoices to overseas customers. Provider uses correspondent factors in the debtor country for credit checking and collections.
When it fits: UK exporters with overseas B2B customers (FCI network covers 80+ countries).
5.Construction invoice finance
CIS-aware, retention-aware, adjudication-aware facility for UK construction subbies and contractors. Handles applications-for-payment, valuations and retention.
When it fits: UK construction businesses with main-contractor invoices, retention deductions, and CIS requirements.
Common UK providers: bibby, close-brothers, skipton, ultimate-finance
6.Recruitment invoice finance
Pay-and-bill, weekly payroll, IR35 and AWR-aware facility for UK recruitment agencies. Often combined with back-office services.
When it fits: UK recruitment agencies running PAYE, umbrella or PSC contractors who need weekly payroll funding.
7.Supply chain finance (reverse factoring)
Set up by the buyer rather than the supplier. Buyer commits to paying invoices early via a bank; supplier accepts a small discount. Buyer-credit-rated, so cheaper for suppliers of investment-grade UK corporates.
When it fits: You supply a large UK corporate (FTSE 100, central government, NHS, BAE, Tesco etc.) and they run an SCF programme you can opt into.
Common UK providers: reverse-factoring
How to pick the right invoice finance solution
- Sector first. Construction, recruitment and export each have specialist solution types that read your business better than a generalist whole-turnover facility.
- Customer concentration. If 60% of revenue is from one customer, most generalist providers cap the advance on that customer. Specialist providers (or selective per-invoice funding for that customer specifically) work around it.
- Confidentiality. Do you want your customers to know you are using a financier? If no, confidential invoice discounting is the route (and requires good credit control in place). If indifferent, whole-turnover factoring is cheaper.
- Commitment. Whole-turnover commits all your invoices for the contract period. Selective is pay-per-invoice with no long-term commitment.
- Speed. Fintech selective (Triver, Hydr) is sub-day. Whole-turnover from established lenders is 3 to 7 working days. Clearing banks are 4 to 8 weeks for new customers.
- Facility size. Mid-tier independents cap at lower facility sizes than the majors. £5m+ facilities are usually clearing-bank territory.
Get three matched quotes
MarketInvoice quotes three best-fit invoice finance solutions from the 85-provider UK panel within 24 hours. Tell us your turnover, sector, customer mix and whether you want confidentiality and we will route you to the providers most likely to fit and quote you the best rate. No fee, named UK contact.
See the 3 solutions that fit your business
Three quotes from the MarketInvoice panel within 24 hours, no fee.
Your details are secure. See our privacy policy.