MarketFinance is an accredited lender for the purposes of the government’s Coronavirus Business Interruption Loan Scheme (CBILS). This means it is able to provide business loans and finance options to those that have been seriously impacted by the crisis.
When MarketInvoice (as it was then known) launched in 2011, it became the UK’s first online-only invoice finance provider. It’s grown to become one of the largest invoice finance providers in Europe, having now funded billions of pounds worth of invoices.
It’s a peer-to-peer (P2P) lender and member of the Peer-to-Peer Finance Association, with both public and private investors.
The platform rebranded in November 2019 and now provides a quick, simple application process and a range of invoice finance arrangements to choose from. You can choose to pay a fixed monthly fee or work with the company on a pay-as-you-go basis. In the future, MarketFinance has stated it is also planning to offer traditional business loans of up to £100,000 paid over 12 months.
MarketFinance invoice financing options
Selective invoice discounting. You upload specific unpaid invoices you want to borrow against onto the MarketFinance website. The lender aims to verify your invoice and pay you 90% of its value (minus a fee) within 24 hours. You receive the rest of the payment after your invoice has cleared.
Confidential invoice discounting. This option allows you to borrow against all your unpaid invoices automatically. You’ll need to allow MarketFinance to connect to your accounting software and complete due diligence on your company. If deemed eligible for this option, MarketFinance will set up a Barclays business bank account on your behalf. Going forward, you would need to tell the clients you invoice to pay into this bank account. MarketFinance will also deposit funds there, based on the invoice information given in your accounting software.
Contract finance. This allows you to borrow against the value of future revenue from contracts/retainers.
What fees will I pay?
Fees are charged as a percentage of the amount borrowed. These percentages are dependent on a number of factors, including the size of your business, expected payment date, the amount of trades performed on the website and the type of loan you sign up for.
You can expect fees to total between 1% to 3% of your invoice values. You’ll be offered a quote before each transaction (pay-as-you-go) or before signing up to a contract (confidential).
If you sign up for a 12-month subscription, you’ll pay a flat monthly fee, plus a smaller percentage of your invoices. This is likely to save you money if you’re planning to use the service regularly.
Key features of MarketFinance invoice financing at a glance
Here are some of the features that MarketFinance has added to make securing business finance fast and effective.
Release up to of the capital in invoices within 24 hours.
Easy-to-use online account management.
Choose between pay-as-you-go or monthly payment options.
Automatic payments via confidential invoice discounting service.
Credit insurance to protect you against clients failing to pay.
Credit control services allowing you to optimise your sales ledger performance.
Telephone and email support during business hours.
Am I eligible for MarketFinance invoice finance?
Minimum trading requirement
Limited Company,Limited Liability Partnership
Additional eligibility info
Must not have any form of insolvency notice or proceedings against the business. Must not have a principal owner/director that is disqualified, bankrupt or subject to other form of personal insolvency.
To be eligible for selective invoice finance, you’ll need a limited company or LLP based in the UK or Ireland with an annual turnover of at least £100,000.
To be eligible for confidential invoice finance, you’ll need a limited company or LLP based in the UK or Ireland with an annual turnover of least £500,000 (or £250,000 with credit control). You’ll need to provide two years of trading history (or one year with credit control) and use one of the accounting software brands supported by MarketFinance.
To be eligible for contract finance, you’ll need a limited company or LLP based in the UK or Ireland with an annual turnover of least £300,000. You’ll need to provide 2 years of trading history and you’ll need to have contracts with UK companies with minimum turnover of £6.5 million p.a. or non-UK companies with minimum turnover of £50 million p.a.
MarketFinance business loans
Fixed rate unsecured peer-to-peer loan
£5,000 to £250,000
6 months to 3 years
Loan rate type
MarketFinance states that you could receive the funds in as little as 48 hours
Invoice financing is likely to be a suitable option for businesses that invoice their clients with long payment terms and need a smooth cashflow.
It’s commonly used by companies in the transport, construction, recruitment and marketing industries, as well those involved in exporting and distributing goods.
However, it’s likely to not be the only form of business finance available to you.
If you’re only looking to borrow a small amount of money on a regular basis, a business credit card could prove more suitable.
If you’re after flexible access to emergency funds for working capital, you may be better suited to a business line of credit or an overdraft on your business bank account (but check the charges for this final option, because they can be extortionate).
If your revenue comes from card transactions, a merchant cash advance lets you borrow a lump sum upfront for a flat fee, then make repayments as a small percentage of future card transactions. The advantage of this is that if business is slow, you repay more slowly, and if business is good, you repay faster – either way, the overall cost is the same.
The bottom line
MarketFinance changed the game when it became the UK’s first online invoice finance service. It’s faster and more flexible than its brick-and-mortar based competitors, and offers competitive fees. If you’re looking for a simple and quick invoice finance service, this company is worth a look.
Frequently asked questions
Invoice financing is not currently regulated by the Financial Conduct Authority (FCA), but MarketFinance is signed up to the Peer-to-Peer Finance Association (P2PFA), which requires its members to adhere to a set of rules to promote good practice and to protect consumers.
MarketFinance has partnered with household names like Barclays, and the Government’s British Business Bank has even funded businesses through the platform.
There’s usually a two-week buffer, after which MarketFinance will email asking for an update. Where your customer has informed you of a delay, you’ll need to show evidence of this, and may be able to request an extension. You’ll have the option to repurchase the debt or propose a repayment plan. Failing these steps, you’ll be obliged to repurchase the debt, and MarketFinance may use funds in your trust account towards this.
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Chris Lilly is a publisher at finder.com. He's a specialist in credit-based products including business and personal loans, mortgages and credit cards, and is passionate about helping UK consumers make informed decisions about their borrowing. In his spare time Chris likes forcing his kids to exercise more.
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