For small and medium sized businesses across New Zealand, one of the most pressing questions related to Invoice Finance is how long it will take to access cash.
Of course, the answer can vary and is dependent on a number of factors: From how quickly your application is approved to how efficiently you set up your facility of ongoing funding.
In this article, we will help break down the different components to the approval timeline and cash access turnaround for you.
For more information about Invoice Finance in general, explore our product offering today.
How long is the approval timeline for Invoice Finance?
How does Invoice Finance work?
Invoice Finance provides your business secured funding, like a line of credit, leveraged against your unpaid sales invoices.
This allows you to maintain full control over how much funding your access and when you submit invoices for financing.
How does the approval process work?
At ScotPac, we cut through much of the red tape used by more traditional finance providers to ensure easier, simpler and faster approval processes.
Step 1 – Submit the required documentation.
Step 2 – Provide the relevant financial information.
Step 3 – Detail the unpaid invoices you are looking to finance.
To ensure your approval process is as quick and hassle-free as possible, make sure you:
- Have all your key financial information available during your submission
- Submit at least 6 months’ worth of banking and business documents.
Our team will then review your application, verify your invoices and customers and assess your business’s overall eligibility for Invoice Finance.
What is the approval timeline?
For most eligible New Zealand businesses, Invoice Finance approval can take as little as 24 hours for a credit decision to be made, or a few business days.
During the approval stage, the team here at ScotPac will take a look at your business’s trading history, customers’ creditworthiness and invoices.
Whilst our approval process moves fast, remember that you won’t have cash access immediately upon confirmation.
How long does it take to set up Invoice Finance?
Once your Invoice finance is approved, we enter the short and simply set-up phase.
A ScotPac consultant will help you with each step in the process:
- Account set up
- Fund transfer system set up
- Invoice linking
- Verification needs
- Legal documentation finalised
- Customers notified (depending on the type of Invoice Finance)
This process can take anywhere from a few to 14 business days, depending on the complexity of your business.
However, the good news is that once your facility is up and running, access to cash is available within one day of invoice submission.
What is the timeline for cash access?
Once your Invoice Finance facility is active, all you need to do is upload the invoices you want to finance.
ScotPac will then provide a cash advance of the agreed amount (up to 85% initially) within 24 hours.
This means you no longer have to wait 30, 60 or even 90 days for customers to pay. You can unlock tomorrow’s payments owed to you today.
How can you reduce the approval timeline?
In most cases, delayed approval processes are a result of insufficient documentation or incorrect information.
You can help streamline and thereby quicken the approval process by:
- Ensuring your provided financial details are accurate
- Have your customer lists ready before submission
- Respond promptly to requests for more information
- Having your documentation (e.g., bank statements ready)
- Knowing which invoices or customers you intend on submitting for funding.
Who is eligible for Invoice Finance?
Knowing ahead of time your eligibility for Invoice Finance can go a long way to saving you time, effort and hassle.
1. Business-to-business only
Only SMEs that sell goods or services to other businesses can access Invoice Finance.
2. Trading history
You will need to have been trading for at least 6 months to be eligible.
3. Average revenue
Only businesses generating a minimum average of $10,000 in invoices per month are eligible for funding.
4. Consistent invoicing and collections
Approval may depend on your being able to demonstrate consistent invoicing and collections.
5. Creditworthy customers
Your customers will need to have reliable payment history for access to Invoice Finance.
6. Registration
Eligible businesses must be registered and operate within New Zealand, with invoices issued in New Zealand dollars (NZD).
Need Invoice Finance fast? Contact ScotPac NZ today.
As the largest non-banking lender in New Zealand and Australia, ScotPac is the pioneering finance provider for SMEs looking to unlock the working capital in their unpaid invoices.
Our lending specialists will work with you to understand your needs, business objectives and timeline to tailor the right facility to help fuel your business’s success.
