Can a new business get invoice finance?

It is possible. Because the funding relies heavily on the quality of invoices issued to other businesses, some start-ups may qualify if they have verifiable B2B customers with strong credit profiles. A director personal guarantee is typically required.

Can I factor invoices owed by one customer?

Whole-ledger facilities usually cap single-customer exposure (concentration) at 20-40%. If you only have one large customer, you will need a specialist single-debtor or selective invoice finance facility.

Can I finance disputed invoices?

Generally, no. Lenders will not fund invoices that are subject to a commercial dispute. If a dispute arises after funding, the invoice usually becomes ineligible and the advance may be recalled.

Can I use invoice finance for public-sector invoices?

Yes. Invoices to the NHS, local councils, and central government are often viewed favourably by lenders. However, government procurement portals can sometimes complicate the legal assignment of debt, meaning a specialist lender might be required.

Can sole traders use invoice finance?

Yes, though the market is much smaller. While most lenders prefer Limited Companies or LLPs, some specialist providers offer facilities to sole traders and partnerships.

What documents do invoice-finance providers need?

Typically: recent management accounts, a full aged debtor and creditor report, sample invoices with proof of delivery/timesheets, and 3-6 months of business bank statements.

Eligibility & Assessment

Invoice finance criteria and eligible invoices

Lenders care more about the quality of your customers than your own balance sheet. Understand exactly what providers assess before offering terms.

Speak to an Adviser Request a quote

Clear B2B requirementsDebtor quality metricsRed flags to avoidApplication document checklist

The three pillars of eligibility

B2B Transactions

You must invoice other businesses or the public sector. B2C (consumer) sales cannot be financed.

Credit Terms

Invoices must be raised on standard credit terms (typically 14 to 90 days). Point-of-sale transactions do not qualify.

Completed Work

Goods must be delivered or services fully rendered. Invoices for future work or unapproved milestones are ineligible.

What makes an invoice 'eligible'?

Not every invoice on your ledger can be funded. Lenders assess individual invoices against strict criteria before applying their advance rate.

Usually eligible:

Standard invoices to UK-based businesses with good credit scores.
Export invoices to approved countries (requires specialist export finance).
Invoices backed by a clear paper trail (signed purchase orders, delivery notes, or timesheets).

Usually ineligible (Disallowances):

Aged debt: Invoices older than the agreed funding period (usually 90 days past invoice date).
Contra accounts: Invoices to a customer who is also your supplier (they may offset the debt).
Inter-company debt: Invoices raised to another business owned by the same directors.
Sale or return: Goods supplied on a sale-or-return basis.
Stage payments: Applications for payment or milestone invoices where the final contract is not yet complete (unless using specialist Construction Finance).

Red flags that can prevent funding

High debtor concentration

If one client represents 80% of your revenue, most lenders will decline a whole-ledger facility. You need a selective facility.

Contractual bans on assignment

If your customer contracts strictly prohibit the assignment of debt to a third party, standard factoring will not work.

Outstanding statutory demands

Unresolved winding-up petitions or severe, unmanaged HMRC arrears will stop a facility from being approved.

High credit note dilution

If you frequently issue credit notes to correct invoicing errors, lenders view the ledger as high-risk and unreliable.

Documents to prepare for application

A detailed aged debtor report (who owes you money, and how old the debt is).
A detailed aged creditor report (who you owe money to).
Latest full financial accounts and year-to-date management accounts.
3 to 6 months of consecutive business bank statements.
A sample paper trail for your largest customer (Purchase Order → Invoice → Proof of Delivery).
Details of any existing crown arrears (HMRC/VAT) and agreed payment plans.

Related Guides

Small Business Factoring

Specific criteria for early-stage and smaller businesses.

View SME criteria

Bad Credit Guide

How prior defaults or CCJs impact eligibility.

View bad credit guide

Who you could speak to

Graham Nash

Commercial Finance Director

Business loans, cash flow and wider commercial funding

Profile

Arran Turner

Managing Director

General commercial finance and how Sorbus works

Profile

STEP 1
A conversation with a broker
You talk to a real Sorbus broker about the business, the purpose and what is affordable. No application at this stage.
STEP 2
Credit placement
If you choose to go further, we prepare the case and decide which lenders on our panel of 150+ are worth approaching.
STEP 3
Lender assessment
The lender, not Sorbus, underwrites and makes the credit decision. Approval is never guaranteed.
STEP 4
Documentation
If a lender offers terms and you accept, we help coordinate agreements and payout paperwork with you.

Every step after the first is optional. You can stop after the conversation. Sorbus is a broker, not a lender.

Client journey

Explore real client journeys

Read how real businesses approached a funding goal, what Sorbus arranged and what happened next.

Browse anonymised case studies

Enquire about Invoice Finance Eligibility

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Unique to Sorbus Finance

Optional: Business Finance Health Check

Not sure if your ledger qualifies? Run our free Finance Health Check. We'll identify any red flags in your debtor book before you submit a formal application to a lender.

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In almost all circumstances we do not charge a broker fee. Should a broker fee be chargeable you will be made aware clearly in advance and it will be agreed in writing before you proceed. Read our Initial Disclosure.

Sorbus Finance acts as a credit broker/introducer, not a lender. We can introduce you to lenders on our selected panel and do not search the whole market. We do not provide advice or a recommendation. Lenders determine eligibility, pricing and final terms. We may receive commission from a lender; the amount and method can vary and may affect what you pay. Read our Commission Disclosure and Complaints Procedure.

Frequently asked questions

Common questions from UK businesses about eligibility.

Ready to discuss your requirements?

Speak to a Sorbus Finance specialist about a suitable eligibility structure for your business. Free, no-obligation comparison across lenders on our selected panel.

01246 383500 General invoice finance guide

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