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What is the fee for, why is it charged?
Fund20 buys your invoice from you so you can receive payment for your invoice as soon as you have completed the work. Fund20 provide you certainty of when your invoice will be paid and take on any risk of your invoice being paid.
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Will Fund20 ever recoup the money from me?
No, Fund20 will never ask for the money back from you as long as all the work has been completed as agreed with your customer.
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Does all the work have to be complete before Fund20 will fund my invoice?
Yes all of the work must be complete or, if there are milestones in a contract, when one of those milestones has been completed.
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Will Fund20 fund invoices that are issued direct to a consumer rather than a business?
Not usually but in some instances we may do, please contact us if this is something you would like to explore further.
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If I don't need to draw the value down of the invoice straight away can I save fees by drawing down nearer to the expected payment date?
Yes, Fund20 will reduce the fee by 0.1% per day. E.g. if your invoice was issued on 1 January with 30 day payment terms, the fee would be 5%. If you chose to draw down the amount on the 10th, rather than the 1st, the fee would reduce by 1% (10 x 0.1%) to 4%.
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Will Fund20 fund any invoice?
As long as the work has been complete then in almost every case yes, unless the company or individual that you have worked with has a bad credit history.
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What happens if my customer pays me rather than Fund20?
This is no problem and happens from time to time, please just make sure it is transferred back to us within 24 hours. If this has happened, please contact us.
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How quickly will I receive my money?
You will receive your money within 24 hours of your customer verifying your invoice.
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Is there a limit on the value of invoice I can finance?
Yes, we will currently accept invoices between values of £250 and £10,000.
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Will a credit check be performed on me?
As this is not a loan, no formal credit check will be carried out on you but we will perform procedures, known as "Know your client" (KYC), where we may request a proof of address or copy of formal documentation to verify that you are who you say you are.
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Is this a loan?
No, this is not a loan, Fund20 is buying the invoice from you less our standard fee. There is no interest that accrues after that purchase. Because this service is not a loan, this will not show on any credit report.
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How do I record the transaction in my accounting records? (i.e. gross or net amount as revenue?)
You would recognise the full invoice amount as revenue and then Fund20's fee would be recognised as an expense. Depending on circumstances this fee is likely to be tax deductible against your earnings, for further accounting advice we recommend you speak to our partners at twentyaccounting.com
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Will it impact my customers?
The only difference it will make for your customers is that they will pay Fund20 rather than you. Your customers are unlikely to have any issue with this as businesses and finance teams are very used to dealing with these sort of arrangements as they are very common amongst small and medium sized businesses.
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What happens if my customer fails to pay?
It is Fund20's responsibility to collect the money from your customer and we will not ask for the money back from you. We may though ask for your assistance in contacting them or resolving a dispute if one arises.
