Our charges and fees explained
Just like other invoice finance companies, Close Brothers Invoice Finance charges its clients fees, which depend on the size of your business, the value of your invoices and the time it takes to get money paid by your customers. Before choosing which product might be best for your business it’s probably helpful for you to understand how both forms of invoice finance (factoring and invoice discounting) work.
Our pricing structure
Our pricing is made up of two core components:
- Service charge – covers the ongoing delivery of your facility and will vary according to the value and volume of invoices you put through the facility. Charges for our credit control, which is included in any factoring service, and optional 100% Bad Debt Protection, are also included here.
- Discount charge - much like a bank overdraft. Charged as a percentage over LIBOR against drawn funds calculated against daily outstanding balance and debited at month end.
Please note that additional fees may apply depending on the type of facility that you require. This will be discussed as part of the intial arrangement of your facility.
Libor, Euribor & Base Rates explained
The London Interbank Offered Rate (LIBOR) is a daily reference rate based on the interest rates at which banks borrow unsecured funds from other banks in the London wholesale money market (or interbank lending market). Alternatively, this can be seen from the point of view of the banks making the 'offers', as the interest rate at which the banks will lend to each other: that is 'offer' money in the form of a loan for various time periods (maturities) and in different currencies.
The Euro Interbank Offered Rate (Euribor) is a daily reference rate based on the averaged interest rates at which banks offer to lend unsecured funds to other banks in the euro wholesale money market (or interbank market).
The official bank rate (also called the Bank of England base rate or BOEBR) is the interest rate that the Bank of England charges Banks for secured overnight lending. It is the British Government's key interest rate for enacting monetary policy.