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• 05 Apr

  Confidential Invoice Discounting For A Drinks Manufacturer Without Giving Personal Guarantees

  

  Confidential invoice discounting (CID) means that customers are unaware that a receivables financing company is providing funding and the client company can continue to maintain their credit control function. Some customers prefer this as they want control over their customer relationships.

  The Need For PGs

  Even a modest bank facility is likely to require a personal guarantee from your directors, and receivables financing can often release a lot more funding.

  Typically, this type of facility would require the directors of the company to provide personal guarantees (PGs). This means that should there be any shortfall in the facility the directors would have to make it good from their personal funds. Sometimes, customers don't like this as they want to separate their personal and business situations. They often don't want to have their personal assets vulnerable.

  In this case, we found our client CID without the need for personal guarantees from the directors.

  Confidential Invoice Discounting Without Personal Guarantees

  We introduced our client to a leading independent invoice discounter that was able to provide confidential invoice discounting without any requirement for personal guarantees from the company's directors. The funder only required a warranty from the directors against the client committing fraud, which the directors were happy to give.

  CID For A Drinks Manufacturer

  Our client was a soft drinks manufacturer looking to grow their business significantly. The invoice discounter we found was able to put in place a CID facility to provide the working capital that our client needed to fund that substantial growth. This has been completed without the need for the directors to provide personal guarantees, which is not typical in our sector.

  Assurance And Peace Of Mind

  The new facility will assure the directors that they have sufficient working capital for expansion without the need to risk their personal assets. Often clients appreciate the peace of mind that comes with this type of arrangement. The facility can also grow as the turnover of the client grows, great news for anyone who is undergoing expansion.

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  NOTE: Nothing in this article constitutes legal advice and we take no responsibility for any of the information in the pages linked above. You should always seek independent legal advice before entering into any type of guarantee or warranty.

  By Glenn Blackman