Work In Progress (WIP) Finance /
Debtor Funding
Manage Cash Flow Effectively with
Tailored Business Loans & Asset Finance
Attractive Rates & Customisable Terms
Funding from £5,000 to £2 Million
All Business Sectors Welcome
Years Experience
Happy Customers
Borrowed
Team Members
Unlock Cash Flow and Keep Your Projects Moving
At V4B Business Finance, we understand the challenges businesses face when capital is tied up in ongoing projects or unpaid invoices. Work In Progress (WIP) / Debtor Funding is designed to bridge the cash flow gaps created by delayed payments, helping businesses maintain steady operations while waiting for projects to be completed or invoices to be paid. This flexible financing solution provides quick access to working capital, so you can keep your business running smoothly without financial disruptions.
What is Work In Progress / Debtor Funding?
Here are just a few examples of what a WIP / Debtor loan can do for you and your business:
- Free up capital locked in unpaid invoices or ongoing projects, ensuring you have the funds to meet operational costs.
- Receive funding quickly, often within 24 hours of approval, giving you the liquidity needed to keep projects on track.
- Tailored to your business needs, with terms that align with your project timelines or invoice schedules.
- Funding is secured against the value of your work in progress or debtor book, eliminating the need for additional assets.
- Keep your operations moving and invest in new opportunities, even while waiting for payments.
Check Your Options
Fill out our quick form. If you’ve traded for 2+ years with £250,000+ turnover, we can help
Speak To Our Team
Our team will contact you to understand your needs and tailor a lending solution for your business.
Start Funding Process
Once your application is approved, our team will finalise and send your loan agreement for signing.
Complete Funding
Once we receive the signed agreement, funds can often be paid out within 24 hours.
Common questions about WIP / debtor funding
What is Work In Progress / Debtor Funding?
Work In Progress (WIP) / Debtor Funding is a financing solution that allows businesses to access funds based on the value of ongoing projects or outstanding invoices. It helps bridge cash flow gaps, enabling businesses to maintain operations while waiting for project completion or client payments.
How does WIP / Debtor Funding work?
The process involves assessing the value of your incomplete projects or unpaid invoices. Once approved, you receive immediate funds, and repayment is made once the invoices are paid or the project reaches certain milestones.
Who is eligible for WIP / Debtor Funding?
Businesses across various sectors, particularly those with long payment cycles such as construction, manufacturing, and professional services, can benefit from WIP / Debtor Funding. Eligibility depends on the value of your outstanding invoices or work in progress.
What industries can benefit from WIP / Debtor Funding?
Industries such as:
- Construction
- Manufacturing
- Professional services
- Any business with long payment cycles or large projects that are paid in phases
Do I need to provide collateral for WIP / Debtor Funding?
In most cases, the unpaid invoices or work in progress serve as the collateral for this type of funding. This means you usually don’t need to provide additional assets as security.
How quickly can I access funds through WIP / Debtor Funding?
Once approved, funds are typically made available within 24-48 hours, allowing you to maintain cash flow and continue operations without delay.
What are the benefits of WIP / Debtor Funding?
The primary benefits include improved cash flow, flexible financing options, and the ability to cover operational costs without waiting for client payments. This ensures that businesses can continue to invest in growth and complete projects without financial disruption.
What are the repayment terms for WIP / Debtor Funding?
Repayment terms vary depending on the agreement, but typically, funds are repaid when your invoices are paid or when the project milestones are achieved.
How much funding can I access through WIP / Debtor Funding?
The amount of funding you can access depends on the value of your unpaid invoices or work in progress. V4B Business Finance will assess the total project value to determine the loan amount.
Is Work In Progress / Debtor Funding suitable for small businesses?
Yes, small and medium-sized businesses can benefit from this type of funding, especially if they face delays in receiving payments for completed projects or services.
Our Business Loan Options
What types of business loan options are available to you and your organisation, whether you are looking for a small business loan or a large corporation loan?
Business Loans
Get additional working capital to help grow your business with a tailored business loan.
VAT Funding
Do you want to spread your VAT bills over the year to improve cash flow? We can help.
Acquisition Funding
If you are considering acquiring another business, we can offer financing.
Corporation Tax Loans
Need to fund a corporation tax bill? We offer bespoke funding tailored to your business.
Professional Indemnity Insurance
We can help you finance your insurance to keep your business protected.
WIP Finance and Debtor Funding Explored
In the world of corporate finance, Work Progress (WIP) Finance and Debtor Funding give you access to tailored loan options for businesses dealing with unfinished goods, ongoing projects, or even just outstanding payments.
As a result, these financing options are ideal for supporting businesses and helping ones like yours manage your cash flow, maintain your inventory levels, and get the most operational efficiency out of your business.
So, whether you are a manufacturer with in-process inventory or a construction company tackling long-term projects, these funding methods can help you improve your financial position and stability, especially in the short term.
What is WIP Financing?
Definition of Work In Progress / WIP finance: Work-in-Progress finance, is a type of funding that supports businesses during the production phase of a project or order. It does so by giving you the cash flow you need to cover your expenses while the work is ongoing – such as paying for materials, labour, or overheads – before your final product or service is completed and payment is received from your customers.
As a result, this type of financing is common in industries like construction, manufacturing, and services, where projects can take time to complete, and your business may face cash flow gaps as a result.
Consequently, WIP finance helps ensure that your operations can continue smoothly without delays caused by financial constraints.
What Are Advantages of Work in Progress Financing?
- ✔️ Improves your cash flow during project or production phases.
- ✔️ Supports timely purchase of materials and supplies.
- ✔️ Prevents delays caused by financial constraints or gaps.
- ✔️ Ensures smooth operation of ongoing projects or services.
- ✔️ Reduces reliance on personal or short-term loans.
- ✔️ Helps maintain good relationships with suppliers and staff.
- ✔️ Provides flexibility to handle multiple projects simultaneously.
- ✔️ Facilitates steady business growth and expansion.
Understanding Works In Progress (WIP)?
The term Work in Progress (WIP) is a line item found under the current assets section of a company’s balance sheet and refers to the total manufacturing costs, including the job costs, direct costs of your raw materials, indirect costs of labour, direct labour costs, and overheads involved in making partially completed goods as well as your finished goods that are still being worked on during the production process. It doesn’t include the value of the raw materials that haven’t yet been used in making a product for sale, for example, as the production costs cover the raw materials, the labour needed to create goods, and a share of overhead costs.
Finally, when the finished product is sold, it transitions from being part of the inventory to being recorded as the Cost of Goods Sold (COGS) on your company’s balance sheet.
Furthermore, if WIP reports are not aligned with the project’s billing cycles or accounting periods, it can cause confusion and lead to misinterpretations of the project’s performance and financial status.
As a result, creating both a company-wide WIP report and a WIP report for each job is a best practice and can make getting financing here much easier as a result. This is because this approach not only gives you better oversight on the WIP costs as well as of your company’s overall health during various stages of completion of your products or projects but also helps you track the progress of your individual projects more effectively while allowing you to show more detail in the loan application process speeding things up as a result.
So, by understanding, managing, and optimising your WIP, businesses like yours can achieve smoother operations, improve your financial management, and ensure that you get more predictable outcomes as an end result.
What Does WIP Mean in Finance?
Tracking your WIP is really key to improving your chances of getting a WIP loan and understanding your company’s financial health and production efficiency.
For example, for manufacturers, this financial reporting will help you highlight progress inventory on the assembly line, ensuring that your inventory assets are obvious.
Construction industry businesses will also benefit by linking job costing to individual projects for accurate financial analysis as well, and with proper management, businesses like yours can assess your total costs, manage your working capital, and improve your financial performance through real-time tracking of your WIP items.
No matter the type of business you are, if you need it for a finished physical product, service or construction project, having the right WIP accounting in place can make getting financing much easier as a result.
Debtor Funding Overview
Debtor Funding then provides businesses with immediate capital by leveraging unpaid invoices as collateral.
Unlike WIP Finance, this type of finance instead focuses on accounts receivable rather than your inventory.
As a result, this funding option can then improve your cash flow management, reduce your reliance on debt, and help you to support your project management activity.
Revenue recognition here also becomes more straightforward, aligning with specific accounting methods as this helps to ensure compliance and transparency in the process.
What Are the Key Differences Between WIP Finance and Debtor Funding?
While both options will help to improve your financial stability, they cater to different needs.
WIP Finance, for instance, addresses the funding of your in-process inventory, focusing on unfinished goods in production.
Debtor funding, on the other hand, helps you speed up your cash flow, which is tied to your receivables.
Consequently, the former supports goods inventory, while debt financing targets services and completed deliveries, giving you more flexibility for diverse industries as a result.
So, What Are the Key Benefits of WIP Finance?
This type of finance can give your business many benefits, including, for example:
✔ Improved Cash Flow
WIP Finance ensures that businesses like yours can maintain a steady cash flow, even during lengthy production cycles or construction work.
✔ Scalability for Business Growth
Your business can also scale your operations better as well by accessing funds tied up in progress inventory or your unfinished products and using this to either improve or complete your products or services.
✔ Collateral Efficiency
Another benefit it gives you is collateral efficiency, which helps you leverage the value of your work-in-process inventory as collateral, transforming an often-overlooked asset into a more useful financial tool.
This, then, can help you maximise the potential of your underutilised inventory while improving your borrowing capacity as it does so. However, it also goes further here and provides businesses like yours with additional resources to help support your operations and growth or to cover any unexpected needs that may arise.
✔ Risk Mitigation and Reduction
This funding will then offset financial risks associated with delays or cost overruns in your manufacturing process, allowing you to keep your project on time and get your invoicing in a timely manner as well.
✔ Gives You Flexible Financing
This type of flexible financing can then help businesses like yours to access the funds when required, offering you a lot of flexibility in managing fluctuating production costs. This approach is also ideal for businesses that need to respond to changing demands, cover unexpected expenses, and maintain smooth operations without being constrained by rigid financial structures or limited cash flow as you do so.
Types of WIP Finance
There are multiple types of WIP finance, such as, for instance:
✔ Invoice Financing
Invoice financing is a popular funding method that leverages outstanding receivables to provide businesses like yours with immediate cash flow.
This works by converting unpaid invoices into liquid assets that companies can then use to manage operational expenses, meet payroll, and invest in growth opportunities while they wait for invoices to come in.
Consequently, this type of financing helps bridge cash flow gaps without taking on long-term debt, offering a flexible and efficient solution.
✔ Milestone-Based Financing
Milestone-based financing can give you funds at specific, predefined stages of a project’s lifecycle.
This is particularly useful in industries like construction and manufacturing, as this approach aligns funding with project progress, helping to reduce the financial risks drastically.
Businesses here can also gain access to capital as they achieve key milestones, helping you to have smoother operations and resource allocation while avoiding overburdening their finances before parts of the project are fully delivered as well.
✔ Supply Chain Financing
Supply chain financing then focuses on helping businesses like yours manage your vendor payments more effectively.
This works by helping you collaborate with your suppliers and financial institutions and get timely payments while improving the cash flow for all parties.
It also helps to support smoother operations, reduces financial strain on the business, and helps you improve your relationships with your suppliers at the same time – ultimately helping you to improve your overall operational efficiency across your entire supply chain network as an end result.
How Does Debtor Funding Work?
Debtor funding, in essence, converts invoices into immediate cash for you to use straight away, which in turn can improve your liquidity without affecting your equity as you do so.
Is WIP Finance or Debtor Finance Right For You?
Contact Customer Services
For more information or personalised assistance, please do not hesitate to contact our finance company, where we have extensive experience in asset finance.
Who Is V4B Business Finance?
Here at V4B Business Finance, as a specialist asset finance provider, we can offer you varying types of business financial services with good business loan repayment periods. Consequently, we specialise in providing you with comprehensive corporate funding solutions for UK businesses, and our team is here to help you find the right loan for you.
Consequently, as a business loan provider, this means that we can offer you a wide range of financial products, including business loans, equipment finance, VAT funding, short-term business loans, and many more business finance solutions.
With over 30 years of experience, V4B Business Finance LTD is a business credit broker and not a lender. We are authorised and regulated by the Financial Conduct Authority (FCA) and the ICO in England and Wales.
As a result, we pride ourselves on delivering your company-tailored financial solutions that support your business growth and development.
Please note: Our finance options are available for business customers only, limited companies only, and corporate customers only.