Selective Invoice Finance Vs Whole Turnover Invoice Finance


In the world of business finance, particularly for small and medium enterprises (SMEs), maintaining a healthy cash flow is crucial. Invoice finance has become a popular solution to this challenge, offering businesses the opportunity to access funds tied up in unpaid invoices. Within this category, two primary types of invoice finance are commonly used: selective invoice finance and whole turnover invoice finance. Understanding the differences between these two options is essential for businesses to choose the one that best suits their needs.

What is Invoice Finance?

Before diving into the specifics of selective and whole turnover invoice finance, it’s important to understand the basic concept of invoice finance. Invoice finance allows businesses to unlock cash tied up in unpaid invoices. With business to business (B2B) trading, companies often sell goods or services on credit terms and it can take 30, 60 or even 90 days to get paid. Having an invoice finance facility removes this burden, as a lender will release up to 90% of the invoice value on the day a copy of the invoice is sent.

Selective Invoice Finance

Selective invoice finance, also known as spot factoring, allows businesses to choose specific invoices to put through their invoice finance facility.


  1. Flexibility: Businesses can choose which invoices to receive funding against.
  2. No minimum fees: Lenders rarely charge a monthly minimum fee for selective invoice finance facilities.
  3. Pay as you go: Only pay fees for the invoices you receive funding against.


  1. Higher Costs: Selective invoice finance providers often charge more per invoice, compared to a traditional invoice finance lender.
  2. Verifications: Each invoice must be verified by your chosen lender before funds are released to your business.

    Whole Turnover Invoice Finance

There are different types of invoice finance that can include the whole turnover within the facility. The type of facility you choose depends on your confidentiality requirements and whether you wish to conduct credit control in-house.
The following discusses the overall advantages and disadvantages of putting your whole turnover through your invoice finance facility.


  1. Consistent Cash Flow: Using all available invoices within your facility gives you the most potential to have a flow of working capital.
  2. Less Decision-Making: If you know that you are going to be putting all invoices through your facility, you do not need to spend time thinking about which ones you want to include.
  3. Potentially Lower Costs: Whole turnover agreements often come with lower fees due to the volume of invoices processed.


  1. Less Flexibility: Businesses are committed to putting all invoices through the facility.
  2. Monthly minimum fees: There is usually a charge applied to the business if they do not raise a certain value in invoices per month.

Choosing the Right Option


Both selective invoice finance and whole turnover invoice finance offer valuable solutions for improving cash flow and financial stability. By understanding the key differences and evaluating their specific business needs, SMEs can make informed decisions that support their financial health. However, we completely understand that this process is difficult without support – as a commercial finance brokerage, we are here to walk you through the process of finding your perfect invoice finance facility.