Invoice factoring is where a business sells its unpaid invoices to another company, usually at a lower value in return for immediate cash flow
Lloyds Banking Group is closing its invoice factoring service for small business customers by the end of the year, according to a report.
Invoice factoring is where a business sells its unpaid invoices to another company, usually at a lower value in return for immediate cash flow. The company who purchased the unpaid invoice then takes control over collecting the full payment.
The service sees Lloyds buy unpaid invoices from small businesses, but this service will end this week, according to the FT. The Mirror has contacted Lloyds Banking Group – which includes Lloyds, Halifax, and Bank of Scotland – for comment.
FT reports that NatWest and Barclays closed their factoring businesses several years ago, while it also revealed that HSBC has tightened its criteria for the service.
Lloyds has made other big changes this year. Lloyds Banking Group customers used to be able to pay in cheques using a pay-in slip – but now, they must use their debit card and enter their PIN to complete the deposit.
Lloyds has also completely axed the ability for customers to deposit cheques at their local Post Offices. It means customers now have to travel to their nearest Lloyds, Halifax or Bank of Scotland branch, or use mobile banking, to deposit cheques.
Lloyds has also this year increased the monthly fee on its Club Lloyds packaged bank account this week from £3 to £5. The monthly fee is still waived if you pay in £2,000 or more each month.
A packaged bank account is a type of current account that includes additional benefits. Club Lloyds gives you one lifestyle benefit each year. You can choose between a Disney+ subscription, six cinema tickets, a magazine subscription, or 25% off certain food and drink brands.
You also get access to the Club Lloyds Monthly Saver and up to 15% cashback at selected retailers. This monthly fee also applies to Club Lloyds Silver and Club Lloyds Platinum accounts, although you have to pay extra on top for these accounts.
You pay an additional £11.50 a month for Silver account, and £22.50 a month for Platinum.
But in some good news, Lloyds has removed debit card foreign currency fees. This applies when you pay in the local currency – if you choose to pay in pound sterling, you may still be charged.
