Selective Invoice Finance UK (2026): Costs, Providers and How It Works

Selective Invoice Finance at a Glance

Key Facts

Selective invoice finance key facts

What to check	What the market actually does
What you select	Individual invoices, or a chosen customer account, depending on the provider
How much you get	Kriya: up to 90% of face value. Hydr: 100% less a fixed fee. No market-wide advance rate.
Commitment	From none at all (Satago, Penny) to a minimum twelve-month term with a £950 monthly minimum fee (Kriya)
Customer contact	From none (Triver) to disclosed credit control run by the funder (Hydr)
Security	Hydr states: neither a charge nor directors’ guarantee. Kriya’s broker terms: all-asset debenture; personal guarantees possible.
Speed once approved	Penny: as little as two hours for existing customers, 24 hours for new ones. Hydr: as little as 24 hours.
Provider terms taken from each firm’s own published material, checked 24 August 2026.

What Is Selective Invoice Finance?

Selective invoice finance is a funding arrangement where you choose which receivables to raise cash against, rather than assigning your entire sales ledger to a provider for an agreed term. You raise an invoice, decide you would rather have most of the money now than in ninety days, and send that one invoice to a funder. The rest of your ledger carries on as it did before, so when you invoice your other customers next month nothing about that changes.

The important distinction is whether you are choosing a customer account or an individual invoice, because providers use “selective” for both. We use the British Business Bank as the neutral baseline: it applies the term to selected customer accounts and reserves “spot factoring” for distinct invoices. Much of the UK market reverses those definitions, so the label alone does not tell you what you are buying.

Selective Finance vs Single Invoice Finance

Single invoice finance is the narrowest version: one invoice, funded once, with nothing left behind. Selective finance is usually a standing arrangement you can return to, so the funder underwrites your business once and then assesses each debtor as you go. If you expect to fund one invoice and never come back, the distinction costs you nothing. If you expect to return three times a year, an arrangement you can reuse saves you starting from scratch each time.

Is Selective Invoice Finance the Same as Spot Factoring?

No, although plenty of providers use the terms interchangeably. Spot factoring is a single transaction: you sell one invoice, the funder collects it, and the relationship ends there. Selective finance is a facility you draw on when you want to. The underlying legal structure is often the same, so what decides the outcome is whether there is a minimum term, whether anything is charged in a month you don’t draw, and who your customer deals with. We cover the one-off route in our guide to spot factoring.

Selective Invoice Factoring vs Selective Invoice Discounting

“Selective” tells you which invoices are funded. “Factoring” or “discounting” tells you who chases the money. Under factoring the funder collects, so your customer deals with them; under discounting you keep credit control and your customer keeps paying you. Providers aren’t consistent about the words. Kriya markets selective invoice discounting, while Hydr runs disclosed credit control on the accounts it funds, which is closer to factoring in everything but name. Our fuller treatments sit on the invoice factoring and invoice discounting guides.

What Is Selective Debtor Finance?

Selective debtor finance funds a chosen customer rather than a chosen invoice. You nominate the account, usually the slow payer that absorbs your working capital, and every invoice to that customer goes through the facility. Hydr describes its product in those terms. It suits a business whose problem is one continuing customer relationship, but it also means you cannot choose separately each time that customer is invoiced.

Which Providers Offer Selective Finance, and What You Actually Select

Judge these products on four mechanics rather than on the label: what you select, who speaks to your customer, what security you give and whether you’re tied in. We read what five UK providers publish about their own selective products on 24 August 2026, and all four move independently of the word on the landing page. Work out which of them your cash flow actually turns on before you shortlist. We classify these products rather than ranking them; for a scored comparison of the wider market, our best invoice finance companies page does that job.

How Selective Invoice Finance Works

1. Choose an Eligible Invoice or Customer Account

You pick the receivable causing the problem. For most providers that means a single invoice for work you have already completed; for a debtor-based product such as Hydr’s it means nominating the customer whose payment habits you want taken off your hands. The invoice has to be genuine, undisputed and for finished work, which rules out a good deal of staged construction and retention billing before you start.

2. The Provider Checks the Business, Invoice and Debtor

Your customer’s creditworthiness can rule out funding even when your own accounts look healthy. The funder assesses your business and the invoice as well, but a selective facility depends heavily on one payer rather than spreading the risk across several customers. A weak customer credit file can therefore reduce the advance or stop it altogether.

Approval and drawdown are two different clocks. Approval involves underwriting, documentation and, for some providers, a call to your customer. Drawing against an approved facility is the fast part: Penny quotes as little as two hours for established customers, Hydr as little as 24 hours. Neither figure describes getting approved.

3. Receive the Advance

Expect anywhere from 90% of face value to the whole invoice less a fee, and check which before you plan around the cash. Kriya advances up to 90% of face value and holds the rest back until your customer pays. Hydr funds 100% of the invoice less its fixed fee, so there is no reserve to wait for. Triver funds individual advances between £100 and £100,000, within an overall facility it states can reach £700,000. There is no market-wide advance rate because providers release different proportions and handle the remaining balance differently.

4. Your Customer Pays Under the Agreed Collection Structure

Settle before you sign whether your customer may be told, because this is the step where it happens. Under Triver’s arrangement your customer pays you as they always did and never learns a funder is involved. Under Hydr’s the funder is disclosed and runs credit control, so your customer’s accounts payable team deals with Hydr. The better fit depends on how much control and privacy you want to keep in the customer relationship, so settle that before comparing providers.

5. Fees and Any Remaining Balance Are Settled

Once your customer pays, the funder takes its fees and releases whatever it held back. On a 90% advance that reserve is the remaining 10% less charges; on a 100%-less-fixed-fee product there is nothing to release, because the fee came off at the front. If the invoice is never paid, recourse decides who carries it, and on most selective facilities that is you. Plan your cash flow around the reserve arriving when your customer pays, not when you draw.

How Much Does Selective Invoice Finance Cost?

The Charging Methods, and Why They Do Not Compare

A single market rate for selective invoice finance would be misleading because providers charge for different things. We found three published charging methods in use, and they measure different quantities, so their percentages can’t be laid side by side: one charges for time, one charges a flat sum per invoice, and one borrows the two-part pricing of a whole-ledger facility and puts a floor underneath it. Work out what each does to your cash flow on the invoices you actually raise, not on the headline rate.

The Same £20,000 Invoice, Provider by Provider

We applied each provider’s published terms to one scenario: a £20,000 invoice to a UK limited company, paid on the thirtieth day. Where a provider doesn’t publish enough to reach a defensible figure we have said so rather than estimating. Every number below is our calculation from published terms, not a quote.

Hydr’s row stops at its £3,000 example because the provider publishes no rate card and does not state that its fee scales, so we will not multiply it to £20,000. Kriya publishes enough to calculate the minimum: £950 is 4.75% of this invoice before the discount charge, which starts at 6.25% a year at the current 3.75% Bank Rate.

The Kriya row is the one I would put in front of anyone who has been told that selective means flexible. Those starting components look like the lowest pricing on the list, and for a business pushing £100,000 a month through the facility they may well be. Put a single invoice through and the monthly minimum turns a 0.25% service fee into something closer to 4.75%, and in a quiet January where you fund nothing at all the £950 still leaves your account.

Kriya is at least consistent about this, because its eligibility criteria ask for businesses invoicing £100,000 or more each month. Our comparison puts Kriya closer to a whole-ledger commitment than an occasional-use product, because its term and monthly minimum work against the flexibility an occasional user needs.

What Happens if Your Customer Pays Late?

The charging method decides what a late payment costs, and the difference grows as the delay continues. A daily discount fee keeps accruing, so a customer taking 75 days rather than 30 costs you two and a half times as much; Triver also applies a minimum charge of ten days’ fees, which matters when someone pays unusually quickly. A fixed fee doesn’t move at all, and Hydr says so explicitly, which is worth real money against a customer whose payment date you can’t predict. Late payment is a separate problem from non-payment, covered below.

Selective vs Whole-Ledger Invoice Finance

Selective finance usually costs more on each invoice and less across the year, provided you use it rarely. A whole-ledger facility charges you whether or not you draw on it, so its cost per pound funded falls the more of your ledger you push through it. Selective finance charges per transaction, so its total rises in step with use. Somewhere between those two lines sits the point where switching pays.

Work it out on the invoices you raised last year, not on the ones you hope to raise this year. Count the months when you invoice nothing worth funding, because those are the months a whole-ledger facility still charges your cash flow.

Cost

On any single invoice, expect selective finance to be dearer. You are buying an underwriting decision on one debtor rather than a spread of them, and the funder prices that concentration accordingly. In return you pay nothing in the months you don’t draw, which is where the annual total turns in your favour.

Flexibility and Commitment

Check the minimum term and the minimum monthly fee before you treat any selective product as the flexible option. This dividing line isn’t as clean as the marketing suggests. A whole-ledger facility normally commits your entire approved sales ledger for a fixed term with a notice period. Selective finance is supposed to avoid that, and with Satago and Penny it does: both state there is no long-term commitment. Kriya, selling a product it calls selective, asks for twelve months and a monthly minimum.

When Whole-Ledger Finance Becomes Better Value

Once you are funding a large share of your ledger every month, the arithmetic reverses. The fixed costs of a whole-ledger facility spread across far more funded value, while each additional selective transaction costs the same as the last. A whole-ledger deal also brings credit control and sometimes bad-debt protection. We work the crossover through with figures on our selective invoice finance vs full facility comparison.

Which Invoices Can You Finance?

Eligibility depends on your customer and the invoice as well as your own business. Healthy accounts will not rescue disputed work, an ineligible debtor or a customer whose creditworthiness the funder will not accept.

Your Customer

Your customer has to be a business or a public-sector body. Triver funds invoices to UK limited companies, LLPs and public-sector entities, and states plainly that invoices to consumers or sole traders aren’t eligible; Kriya requires the same. Their credit standing then drives the decision, which is the part that surprises people: you can be turned down because of who owes you the money, not because of anything in your own accounts.

Invoice Value and Payment Terms

Payment terms have a ceiling: Triver and Kriya both cap them at 120 days. On value, Triver advances between £100 and £100,000 per invoice, while Kriya’s facilities run from £100,000 to £3m and upwards, which tells you it is not aiming at a business wanting one invoice funded.

Proof of Delivery and Completion

Expect to prove the work is finished before anything is funded. Triver states invoices must be for completed work, and every funder we checked wants evidence of it, because an invoice for something half-finished is not a debt your customer has to pay yet. In practice that means a signed delivery note, a signed-off timesheet, a completion certificate or a matching purchase order. Gather these before you apply so the funder can assess the invoice without coming back for missing evidence.

Disputed, Retention and Stage-Payment Invoices

None of these are routinely financeable. A disputed invoice isn’t a reliable debt, so funders exclude it. Retention sums are held back by contract and may not fall due for months after practical completion. Stage payments and applications for payment, common on construction contracts, may be subject to certification or set-off, which is why construction is treated as its own underwriting problem.

Debtor Concentration and Contract Restrictions

Check your funder’s concentration limit and your own customer contracts before you count on this. Concentration cuts both ways. On a whole-ledger facility, one customer growing past a set share of your book gets capped, which is a common reason businesses look at selective finance at all. But selective funders apply limits too: Kriya’s published criteria set a maximum 50% debtor concentration. The contract side matters as much. Some commercial contracts ban you from assigning the debt at all, and while the Business Contract Terms (Assignment of Receivables) Regulations 2018 make many such clauses ineffective, the exclusions are real.

International Invoices and Currencies

Selective finance isn’t automatically UK-only, and the market has moved here. Triver funds sterling invoices to UK limited companies, LLPs and public-sector bodies and to non-UK large corporates, plus US dollar and euro invoices to large corporate buyers abroad. Kriya caps export exposure at 50% of the ledger. If you sell overseas, ask rather than assuming a UK funder won’t touch it.

Will Your Customer Know?

The word “selective” does not tell you whether a funder will contact your customer. We found four disclosure models across the five providers we checked, ranging from no contact to disclosed credit control. Put that distinction on your shortlist early, especially when the customer being funded also decides whether you win the next contract.

Disclosed Selective Finance

Your customer is told, and pays the funder. Hydr is the clearest example: it describes itself as a disclosed product and manages credit control on the accounts it funds. Useful if chasing payment is the job you want to hand over; unwelcome if you would rather your customer’s finance team didn’t know your cash flow depends on them.

Confidential Selective Finance

Your customer is not told, and keeps paying you. Triver states it does not contact your customers and that they continue to pay you directly. Penny offers a confidential discounting option alongside its spot product. Confidentiality is normally granted by the funder after underwriting rather than selected by you, so treat it as a question to ask.

Invoice Verification

Ask whether your customer will be contacted to verify the invoice, even on a confidential facility. This is the step people miss. A funder can leave collections entirely with you and still contact your customer once, to confirm the invoice is real and the work was done. Kriya says it verifies first invoices by telephone, adding that it never openly discloses it is calling on its own behalf, then moves to automated email. That is a meaningful distinction, but it isn’t no contact at all.

What Happens if Your Customer Does Not Pay?

On most selective facilities, you do. Recourse means the funder can reclaim the advance from you if the invoice goes unpaid after an agreed period, usually somewhere between 90 and 120 days past the due date. The cash you drew in June comes back out of your account in October, which is precisely the month you were least expecting it.

Non-recourse facilities exist and shift that risk, but the protection is conditional. Cover is normally tied to a credit limit approved on that specific customer, applies to insolvency or protracted default rather than any non-payment, and falls away where the customer is withholding because of a dispute. Non-recourse never means you can never be asked to repay. Read what triggers the cover and what voids it, and treat a dispute as the most likely thing to void it.

Advantages and Disadvantages of Selective Invoice Finance

The selective trade-off

Is Selective Invoice Finance Right for Your Business?

Selective finance is best suited to occasional or concentrated funding needs. Once you are financing much of the ledger every month, transaction-by-transaction pricing is solving the wrong problem.

• One large customer on long terms, everyone else paying on time. This is the case selective finance was built for. Fund that customer’s invoices and leave the rest of your ledger alone. If it is the same customer every time, a debtor-based product saves you making the decision monthly.
• Seasonal cash flow. Worth it, provided you check the minimum fee. A product with no monthly minimum costs you nothing across a quiet summer; one with a £950 floor costs you £950 a month for the privilege of not using it.
• Occasional large contracts. A good fit, and the place to concentrate your effort is eligibility rather than price. Contract work is where retention, staged billing and certification most often make an invoice unfundable, so confirm the invoice qualifies before you build the cash-flow plan around it.
• Regular funding needs across many customers. Probably not. If you are financing a large share of your ledger every month, you are paying transaction pricing for what has become an ongoing facility. Price a whole-ledger deal and compare properly.

How to Apply for Selective Invoice Finance

Get the evidence together before you apply, because approval turns on whether the invoice and completed work can be verified. Missing customer details, delivery evidence or contract documents gives the funder another reason to pause the application. Have this to hand:

• The invoice itself, with your customer’s full registered details
• Proof that the work is finished: a signed delivery note, completion certificate or signed-off timesheet
• The purchase order or contract the invoice was raised against
• Your customer’s payment terms and their payment history with you
• Recent business bank statements, and your latest accounts if the funder asks
• Your aged debtor report, which most funders want even for a single-invoice request
• A short explanation of why you need the cash and when you expect to be paid

Check the trading-history requirement before you spend time on an application. Kriya’s published criteria ask for at least two years of trading, consistent monthly invoicing of £100,000 or more, and either profitability or twelve months’ cash runway, alongside being up to date with HMRC or on a Time to Pay arrangement. Those are Kriya’s criteria rather than a market-wide rule, but they rule out an application that does not meet its published trading-history and invoicing requirements.

Alternatives to Selective Invoice Finance

Selective finance solves one specific problem: money you’ve already earned that has not arrived yet. If that isn’t quite your problem, something else fits better.

• Whole-ledger invoice finance. Cheaper per pound once you are funding most of your ledger every month, and it brings credit control with it. See our invoice finance guide.
• Business overdraft. Simpler and usually cheaper for small, short gaps, but limits are modest and banks have been withdrawing them.
• Revolving credit facility. Draw and repay as you like against an agreed limit, without tying the funding to particular invoices. Better where the timing gap is not caused by receivables at all.
• Short-term business loan. Right when you need money you haven’t yet earned: stock, equipment, or a hire before the revenue arrives. That is exactly what invoice finance can’t do.

Is Selective Invoice Finance Regulated in the UK?

We separate four things here, because keeping them apart tells you what protection you actually have when a facility goes wrong and you pay for it out of your cash flow.

The product. Commercial invoice finance to a limited company is not a regulated activity, so the agreement sits outside the Financial Conduct Authority’s consumer-credit rules and the Financial Ombudsman Service does not currently consider complaints primarily about it. Sole traders and small partnerships can fall differently depending on the amount and purpose.

The provider. A funder may hold FCA authorisation for other business it writes. That says nothing about whether your invoice finance agreement is covered, and firms aren’t always careful about the distinction in their marketing.

Anti-money-laundering registration. Invoice financiers register with the FCA as Annex 1 financial institutions for money-laundering supervision. Registration is a supervisory obligation, not authorisation, and gives you no conduct protection. A firm describing itself as “FCA registered” usually means this.

Trade-body standards. UK Finance operates the Invoice Finance and Asset-Based Lending Standards Framework, which sets standards its members sign up to and provides an independent complaints route through the Centre for Effective Dispute Resolution (CEDR). It’s a trade association, not a public regulator, and it binds members only. Where the Ombudsman is closed to you, that is what remains, so check membership before you sign.

Selective Invoice Finance FAQs

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Related guides

Invoice Finance Explained→ Spot Factoring→ Selective Invoice Finance vs Full Facility→ Invoice Factoring→ Invoice Discounting→ Best Invoice Finance Companies→