SME bank Tide has teamed up with InsurTech platform Hokodo to release the Invoice Protection service.
The goal of the new offering is to help SMEs protect their cash flow against late and non-payments of invoices. By protecting invoices, clients can protect their cash flow uncertainty and guarantee the payment of invoices, even if the customer does not pay.
Hokodo handles the debt collection on overdue invoices and if the money cannot be collected or the customer is insolvent, the company protects 90% of the invoice value. Members can choose which invoices they would like to protect, up to the value of £20,000, for a small fee, which is normally between 0.3% and 1% of the value.
Tide members will also be able to get additional insights into their customers’ financial health. They can now conduct risk assessments to improve their decision making.
Research from Tide, found that UK SMEs are chasing a total of £50bn in late payments, with an average of 1.5 hours a day spent chasing them.
Hokodo co-Founder Richard Thornton said, “As the impact of Coronavirus continues to intensify, many SMEs will be worried about what the next few months will bring, whether they’ll receive payment, and whether they or their clients face the risk of insolvency. It is now more vital than ever that SMEs put the right measures in place to deal with any potential risks.”
Hokodo recently launched its services in France after forming a deal with accounting platform Cegid.
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