Tallinn based p2p lending marketplace Investly, which recently launched an invoice finance product in Estonia announced the launch of the service for UK SMEs. The invoice finance option will give UK businesses almost instant access to much needed working capital to aid growth.

The launch comes after a successful European launch of the platform in Estonia 18 months ago, and a subsequent investment of 600,000 Euro from Venture Capital group, SpeedInvest.

Until now, invoice finance options – whether through traditional channels or via other peer-to-peer platforms – have been complex and laden with fees and charges.

Investly says it has simplified the product so that, once credit checks have been cleared, SMEs can sell invoices to investors within two days. And therefore assign the money to aid growth, enabling them to be the best they can possibly be without the cash flow worries. Initially, the invoice finance product will be available to any UK SME who passes the platforms sign-up criteria, which includes credit checks and confirming their identity. Further safeguards are put in place such as directors’ checks and potential guarantee.

Ruth Chamberlain, Investly’s UK Country Manager, said: “Long payment terms are crippling for UK SMEs. They are dependent on cash to sustain and grow their business, but as they invest in products and people, they may not get money on work completed a month or even 120 days after issuing their invoice. This is putting many businesses at risk – especially smaller ones and those that depend on payments from one or two key customers.”

Chamberlain continued: “Investly brings together investors with growing SMEs in need of vital capital. Our concept, expertise and technology allows businesses to be the best they can be by making the invoice finance process as simple as it has ever been. After in-depth market research, we believe that this product is perfect for businesses operating in the IT and media sectors, as well as recruitment and construction.

As well as the invoice finance process, the fees have also been made as simple as possible so that all parties are clear and understand who is owed what. For example, if a business has an invoice of 10,000 GBP for sale and the payment term is 30 days, a final sale price may be reached in the auction at 9,850 GBP. The ‘seller’ or invoice owner will be forwarded the agreed 9,850 GBP, while the remaining 150 GBP will go to the investors, with Investly getting a fee as a proportion of this total.

Speedinvest, an Austrian based venture capital fund invests into seed stage start-ups around Europe. Stefan Klestil, and his partners at Speedinvest are known for their successful investments in financial technology; such as London based Curve and German success stories Wirecard and number26.

When talking about the investment, Mr Klestil highlights Estonia’s start-up scene and particularly the recent success stories such as Transferwise and Bondora. “Investly is making finance much more accessible and convenient especially for smaller businesses who are suffering from lack of access to working capital,” says Mr Klestil. “We know that we are able to help making Investly into a global success story,” he added.

As well as launching in new markets, the funding will go towards a significant recruitment drive in the UK which will see numerous marketing and sales professionals employed in the coming months.

As part of the launch phase, Investly is allowing the first 20 successful companies the ability to sell an invoice worth up to 5,000 GBP completely discount-free.

Businesses interested should register at the website, input basic information and go through Investly credit checks. Once accepted, upload an invoice for sale to investors – minimum value of 1,000 GBP. The auction will take place where investors bid on the invoice. Once sold, the owed money minus the discount will be transferred within 24 hours.

At launch, institutional investors, high net worths and sophisticated investors will be buying the invoices. Over time and as full FCA authorisation is approved, it is anticipated that retail investors will also be able to invest through Investly. Expected returns currently range between 10% and 19% pa gross before losses. A loss rate of 0.2% is estimated by the platform.

Investly competes in this market segment with Platform Black and MarketInvoice.