Best Invoice Factoring Companies in the UK

Invoice factoring has become one of the most widely used cash-flow solutions for UK businesses that invoice with payment terms. From recruitment agencies funding weekly payroll to fast-growing SMEs bridging working capital gaps, invoice factoring allows businesses to unlock cash tied up in unpaid invoices within 24 hours.

However, not all invoice factoring companies in the UK are the same. Pricing structures, contract terms, flexibility, sector appetite, and service quality vary significantly between providers.

This guide explains:

• How invoice factoring actually works in the UK

• How to choose the best invoice factoring company for your business

• The true cost of invoice factoring

• Which invoice factoring providers are currently leading the UK market

• Why using an independent broker often delivers a better outcome

What Is Invoice Factoring?

Invoice factoring is a form of invoice finance where a business sells its unpaid invoices to a factoring company in exchange for an immediate cash advance (typically 70%–90% of the invoice value). The factoring company then collects payment directly from your customer and releases the balance (minus fees) once the invoice is paid.

This makes invoice factoring particularly suitable for:

• Recruitment companies

• Construction companies

• Engineering businesses

• Logistics and transport firms

• Manufacturing and wholesale businesses

• B2B service providers

• High-growth SMEs

How to Choose the Best Invoice Factoring Company in the UK

The “best” invoice factoring company depends entirely on your business model, sector, and funding priorities. Key factors to consider include:

• Advance rates (how much cash you receive upfront)

• Discount fees and service fees

• Contract length and exit terms

• Confidential vs disclosed factoring

• Sector specialism (e.g. recruitment, construction, transport)

• Credit control quality

• Funding speed and scalability

Many UK businesses overpay or lock themselves into inflexible agreements simply by going direct to the wrong provider.

How Much Does Invoice Factoring Cost?

Most invoice factoring companies charge:

• A discount fee (similar to interest, based on usage)

• A service fee (for ledger management and collections)

Costs vary widely depending on:

• Turnover and ledger size

• Debtor quality

• Industry sector

• Risk profile

• Facility structure

This is precisely why comparing the whole market, not just one or two providers is critical. A specialist Independent broker such as Secure Business Finance will source the offers and run the review of terms for you- so you can get back to running your business and they can present the offers. 

13 Best Invoice Factoring Companies in the UK

Below is a curated list of leading invoice factoring companies in the UK. Each has different strengths depending on business type, size, and funding complexity:

• eCapital – Flexible, scalable invoice factoring for growing businesses

• Time Finance – Relationship-led factoring solutions for SMEs

• Sonovate – Specialist in recruitment and contractor finance

• Bibby Financial Services – Full-service factoring with credit protection options

• Close Brothers Invoice Finance – Bespoke mid-market solutions

• Novuna Business Cashflow – Backed by the Mitsubishi Group

• Metro Bank Invoice Finance – Bank-integrated invoice finance solutions

• Ultimate Finance – Strong in sector-specific facilities

• Team Factors – Tailored solutions for complex funding structures

• Pennyfreedom – Digital-first, flexible, selective invoice finance

• Paragon Bank – Transparent and fast factoring facilities

• Grenke Factoring – SME-focused invoice finance

• 4Syte – Online-first invoice finance for SMEs

Importantly, no single provider is “best” for all businesses. The right solution depends on structure, cost, sector and growth plans.

Why Use an Independent Invoice Finance Broker?

With dozens of invoice factoring companies in the UK, each using different pricing models, risk criteria, and contract structures, navigating the market alone is time-consuming and expensive.

An independent broker such as Secure Business Finance:

• Compares the whole market, not just one lender

• Matches your business to lenders that actually want your sector

• Negotiates fees, advance rates, and contract terms

• Avoids unsuitable long-term commitments

• Accelerates approvals and funding

In many cases, businesses secure better pricing and terms through a broker than by going direct.

Why Secure Business Finance?

Secure Business Finance specialises in arranging invoice factoring and invoice finance facilities for UK SMEs across all major sectors.

What sets Secure Business Finance apart is deep, first-hand experience of the invoice finance market. The team has previously worked directly within banks and independent invoice finance lenders, providing a detailed understanding of how funding decisions are made, how pricing is structured, and what lenders look for when approving facilities.

This experience, combined with long-standing relationships built directly with key decision-makers and senior teams at UK lenders, allows Secure Business Finance to present clients to funders in the strongest possible light and negotiate market-leading rates and terms that are often not available when approaching lenders directly.

Clients benefit from:

• Full, whole-of-market access to UK invoice factoring and invoice finance lenders

• Independent, unbiased advice tailored to each business

• Expertise from advisers who have worked within banks and specialist lenders

• Transparent guidance on true costs, fees, and contract structures

• Support negotiating terms directly with senior lender contacts

• A faster, more confident funding decision

• Ongoing support in life
  
  

By combining insider market knowledge with an independent, client-first approach, Secure Business Finance helps businesses secure the right funding solution, on the right terms, with complete clarity from day one.

Final Thoughts

Invoice factoring is one of the most powerful cash-flow tools available to UK businesses- but only if it is structured correctly with the right provider.

Rather than asking “Who is the best invoice factoring company in the UK?”, the smarter question is:

“Which invoice factoring company is best for my business?”

That is exactly the question Secure Business Finance helps you answer.