CLARATUS GROWTH SCHEME FAQ’s:
Who is Claratus? Claratus provides clear, fair and effective finance directly to the SME and Professions sectors for a wide variety of requirements. The business was founded with support of Business Environment and is based in the Minories centre. The Directors of Claratus, Nick Ray and Simon Clarke, have over 20 years of experience in the business finance industry.
What is the offering? Access to an online platform which lets your business sell single invoices online, as and when you need to, with no contracts, hidden fees or personal guarantees.
Why? If your business sells into large organisations, you’ll know how painful it is to wait for your invoices to be paid. Payment terms as long as 90-120 days cause inevitable issues with cashflow.
Who is eligible?
All sorts of businesses, which meet these criteria:
– A Ltd company or LLP (Limited Liability Partnership), registered in the UK
– Selling goods or services to other businesses, either in the UK or abroad, and are paid on terms
– Trading for at least 6 months, with annual revenues (actual or forecast) of at least £100k
– One or more company directors who are resident in the UK
All businesses must also pass anti-fraud and credit checks. Unfortunately we can’t accept applications from sole traders, or from businesses that are based outside the UK.
What is the process?
1. Claratus will complete a simple application, for which there’s no cost and no obligation.
2. Once approved, you’ll get a log in to the platform.
3. Your invoices are checked and then scheduled to sell in one of the twice daily trading sessions.
4. Funds will be advanced and available to you in your account within one working day.
How long will it take? The initial set up and credit approval process typically takes one or two working days.
How much information is required to proceed? Typically accounts, aged Debtors Report and 3 months Business bank statements. Further information may be required or may help reduce the cost of the service.
Who is the finance provided by? For this scheme, Claratus arrange finance through MarketInvoice, which has arranged over £500m of finance since 2011 and is supported by the UK Government via the British Business Bank. There are no additional costs for dealing through Claratus.
How is this different to factoring or invoice discounting? Unlike invoice discounting, you only sell the invoices you want to sell, and there are no restrictive covenants or personal guarantees. There are no ongoing monthly service fees or non-use fees. Where traditional invoice discounters do not accept certain invoices or turn down your application, by posting the invoice on the platform you will find an investor keen to buy. There are no contracts and there are no hidden fees. You’ll see exactly the cost of your finance upfront.
How much does it cost? Fees are applied on a trade-by-trade basis and vary according to a number of factors, including invoice value, expected payment date and the number of invoices you’ve traded so far. The total fee for an invoice sold is, on average, between 1% and 3% of invoice value and will be made clear before you decide to proceed. The cost consists of two elements: a service charge, which is a fixed % of the invoice value, and a monthly interest charge, which depends on how long your customer takes to settle the invoice.
What happens if an invoice I’ve sold isn’t paid by my customer? If you receive advanced cash on a sold invoice, and the invoice is not eventually paid by your customer, you will have to refund the amount owed to the investor. Because the finance you receive is recourse finance, in the event of non-payment by the trade debtor, the original invoice advance must be refunded to the buyers. The time at which businesses must refund the money to the buyer is called the Repurchase Date. The Repurchase Date is 45 days after the expected (rather than stated) payment date. You may choose to fund alternative invoices to cover the refund.
Will my customers know that I’m selling invoices? You retain the communication with your customer, and it is your responsibility to chase up the invoice. Your customer will pay the invoice to an account in your name held with MarketInvoice, but their name will not appear on the account. MarketInvoice will also conduct light-touch verification that the customer intends to settle the invoice, with an email requiring your customer’s response. A confidential service can be offered.
What are the terms regarding the £250 payment? Register with Claratus before 31 October 2015 and fund an invoice on the portal before 30 November 2015. As long as Claratus receive the bonus from our provider, we will share this with you. You will need to provide an invoice to Claratus.
Can Claratus help with other areas of my business? Yes! We can assist with a wide range of projects and requirements, ranging from below £10k to several £m:
– Technology projects including Hardware, Mobile devices, Software and Services
– Loans for Tax, VAT & PII
– Plant – including Refinancing
– Vehicles – including Classic/High value cars
– Fit-out/refurbishment costs (office and retail), with large potential tax savings
– Invoice Discounting and Factoring
– General working capital (may require Personal Guarantees or further security)
To proceed with the scheme or for further information, please contact:
Nick Ray or Simon Clarke
Phone: 0207 294 7500