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Refinancing & Switching

Switching your invoice finance provider

Outgrown your current lender? Switching invoice finance providers is a standard process that can typically be managed smoothly to minimise operational disruption.
Seamless ledger transferNegotiate better ratesRemove restrictive capsExpert broker management

Why businesses switch providers

Invoice finance facilities should scale with your business. Sometimes, a facility that suited a smaller turnover becomes restrictive or less cost-effective as you grow. Common triggers for exploring a switch include:

  • Cost: Service fees are uncompetitive, or the lender is adding excessive disbursement charges for CHAPS payments and audits.
  • Restrictive limits: Your current provider won't increase your overall facility limit, or they are enforcing strict concentration limits that stifle your largest accounts.
  • Poor service: Aggressive or unprofessional credit control is damaging your customer relationships.
  • Upgrading: Moving from disclosed Factoring to Confidential Invoice Discounting as your internal finance team matures.

How the switching process works

Switching is a routine procedure. New lenders handle the mechanical transfer (called an "inter-factor transfer") directly with your old lender.

  1. Market review: A broker assesses your current ledger and secures offers from new lenders.
  2. Serve notice: You officially serve notice to your current provider.
  3. Setup and audit: The new lender completes their due diligence and sets up the new facility in the background.
  4. Settlement figure: The new lender requests a final settlement figure from your current provider.
  5. Transfer day: The new lender advances funds to pay off the old lender. Any surplus cash generated by a higher advance rate is released to you.

Traps to avoid when terminating

Termination fees

Read your contract. Leaving before the end of your minimum term will usually incur an early termination fee, often calculated as the minimum service fee multiplied by the remaining months.

Notice periods

Contracts often require 3 or 6 months' notice. Serving notice on the wrong date can accidentally trigger a 12-month contract rollover.

Settlement delays

Your current provider may drag their feet in producing the final settlement figure. Strong broker management is required to keep them on schedule.

Advance rate drops

During the notice period, an aggressive incumbent lender might abruptly reduce your advance rate or tighten limits. Ensure your new facility is ready to deploy quickly.

What to check before initiating a switch

  • Locate your original signed agreement and verify the exact minimum term end date.
  • Verify the required notice period (e.g., 3 months) and the exact method required to serve it (e.g., recorded delivery).
  • Calculate the total exit cost, including any termination penalties and final audit fees.
  • Do not serve notice until you have a formal, approved offer from a new lender.
Enquire about Switch Invoice Finance Provider

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Unique to Sorbus Finance

Business Finance Health Check

Before serving notice to your current provider, run our Finance Health Check. We will evaluate your current terms and tell you confidentially if better rates are available in the market.

Run your free Health Check

Free · No credit check · Instant results

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 switching providers.

Ready to discuss your requirements?

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

01246 383500