GROWTH is an exciting yet demanding challenge facing all businesses. Finance is critical to facilitating growth and with loans and overdrafts arranged it would be easy to presume that the headache was over. However, for many businesses it may only have just begun.

Sometimes traditional finance products are not flexible enough to keep pace with the growing needs of companies. Invoice finance is becoming increasingly attractive to companies as a way of freeing up funds tied up in unpaid invoices.

It works on the basic principle that the invoice finance company advances funds relating to invoices issued by the client business.

So, rather than waiting for payment, the company receives money almost immediately.

Trade debtors are often the largest assets on a company's balance sheet. Invoice finance in the form of invoice discounting - sales linked finance - unlocks their value and provides immediate working capital to facilitate expansion, be this through acquisitions, management buy-outs or management buy-ins.

Using invoice finance offers many advantages. It maximises the amount of cash available for ongoing working capital, preventing your business from being strapped for funds.

The flexibility of the facility also allows the availability of funding to grow in line with your sales.

RBS has recently renamed its invoice finance business. The Royal Bank of Scotland Commercial Services will now be known as "RBS Invoice Finance".

RBS Invoice Finance will continue to provide a wide range of invoice finance solutions, from efficient day to day cash-flow management to better use of business assets to businesses in Worcestershire.

Phil Dutton, director of commercial banking, Worcestershire