Factoring and invoice discounting is now considered to be mainstream finance rather than a type of alternative finance as it once was in the past and with it’s increasing popularity in the last few years and on the back of that growth has come a sharp rise in the number of factoring brokers, all claiming to offer their expertise and so called independent advice claiming to find their customers the best deal.
Unfortunately the reality is often far from the truth as whilst the unsuspecting customer will expect to be receiving unbiased advice from an experienced factoring broker, that is frequently not the case as many of the high profile factoring brokers are anything but independent, unbiased or even experienced.
For many years Cashflow UK was a high profile invoice finance broker outfit claiming to offer independent advice but as it was actually owned by Bibby Factors one has to wonder just how independent their advice actually was. Having operated for many years in this manner the name has now been dropped and the Cashflow UK website now states that it’s a subsidiary of Bibby Financial Services.
Leaving them aside there are a number of self styled independent factoring brokers who are actually anything but independent as they earn a major part of their income by carrying out audit and other work on behalf of some factoring companies on a mutual back scratching basis and if they ceased producing leads for the factoring companies their lucrative quid pro quo accounting work would soon dry up.
Additionally the big growth in factoring broker companies in the last few years has come from divisions of insolvency practitioners who have got into the business as a way to obtain more lucrative insolvency work from the factoring companies with many making it quite plain to the invoice finance companies that if they don’t receive insolvency work they won’t be getting any introductions from them.
Unfortunately there are neither professional qualifications needed nor a regulatory body in place which is why the Independent Factoring Brokers Association was formed by a number of specialist independent brokers in order to provide some transparency and a quick look at some of the web pages on this site ( links on the right) may prove to be illuminating.
Independent Factoring Brokers Association, Torridge, Tamworth, Staffordshire B77 5QL