Xero & Natwest
You have been selected to be part of the pilot based on a set of eligibility criteria, which means you can get an obligation free quote from NatWest Rapid Cash through Xero. The criteria includes factors such as your industry, how often you invoice customers through Xero, and how many of your invoices are awaiting payment.
We know that running a business is challenging, particularly the unpredictability that often comes with managing cash flow. NatWest Rapid Cash helps you take control and smooth out cash flow, giving you the financial confidence to focus on running your business.
Over time we expect that access to working capital via trusted lenders will be a regular feature in Xero.
No, NatWest is the financial provider. Xero is simply making it easier for you to access working capital through trusted financial service providers like NatWest to help manage cash flow.
NatWest Rapid Cash
NatWest Rapid Cash is a continuous service that provides a short-term cash advance against your outstanding invoices. Their innovative funding solution could help smooth out cash flow, putting you in a better position to cover company expenses and capitalise on new opportunities.
Because Rapid Cash is linked to your outstanding invoices, the level of funding can increase as your business grows, offering you the flexibility to continuously access the cash if and when you need it.
Xero does not provide invoice finance, but we make it easy to apply to access capital from providers like NatWest, by using relevant data from your Xero subscription.
Many businesses will provide credit to their customers by way of an invoice with payment terms (typically 30 days). This results in large amounts of working capital being tied up in outstanding invoices, and it’s not always known when the customer will pay the invoice.
Plus, many customers pay invoices late. Xero Small Business Insights indicate that it takes an average of 32.2 days for small businesses in the UK to be paid (1). This means small businesses often experience unstable cash flow.
NatWest Rapid Cash enables you to access the money you’re owed sooner, so that you can smooth out cash flow and take on new opportunities if they arise.
We suggest you speak to your accountant, business advisor or if you have one, your NatWest Relationship Manager, about whether NatWest Rapid Cash is a suitable solution for your business.
If you’ve been selected to be part of this pilot, we will contact your Xero advisor (if you have one) so they are aware of the pilot and can support you.
With NatWest Rapid Cash you're only charged for the funds you access, a rate that's calculated daily and charged once a month to your Rapid Cash account. There are no exit or monthly fees.
For borrowing up to £300k, rates range from 4.5%-8.5% per annum, there are no arrangement fees.
For example, if you draw down £15k for 1 day and your rate is 6% (with base rate that's 6.10%) then it will cost you £2.51.
You’ll need to meet the following eligibility requirements:
- You have been trading for 6 months or more
- Your turnover is £100,000 or more
- Your business is incorporated in the UK (e.g. limited company or limited liability partnership)
- You invoice other businesses
- You invoice customers only once work is complete
No. Unlike invoice factoring, your customer relationships stay with you. NatWest Rapid Cash won’t contact your customers and your customers won’t be aware that you have obtained finance against their outstanding invoices.
NatWest Rapid Cash enables you more freedom and flexibility to run your business as it offers:
Fast funding: Once you’ve supplied the required documents the funds can be in your account within as little as 48 hours.
Flexible finance: NatWest Rapid Cash works with the flow of your business. You can access funds when you need them, and only pay for the funds you use. Plus, there are no lock-in contracts or monthly fees.
Bringing forward money owed to you: accessing cash tied up in your outstanding invoices means that you are drawing on money you can afford to pay back.
Simplified process: Xero’s partnership with NatWest Rapid Cash means you can connect your Xero account and receive an accurate and timely quote from NatWest Rapid Cash. Additionally, this connection allows your facility to grow and shrink with your business. Transactions are automatically imported into your Xero account and reconciled.
Greater control and confidence: Freeing up cash gives you the control and confidence to cover company expenses and capitalise on new opportunities when they come along.
- Customer relationships stay with you: unlike invoice factoring, your customers will never be contacted by NatWest.
NatWest Rapid Cash provides you greater flexibility and freedom to access working capital when you need it, particularly if your business is impacted by seasonality, experiencing growth or issues a significant value of invoices each month.
NatWest Rapid Cash may not be a suitable option to fund all business growth activities such as hiring additional staff or purchasing large equipment that require longer-term funding.
You should also avoid using NatWest Rapid Cash for recurring cash flow issues that can be rectified by addressing the underlying causes. For example, whilst NatWest Rapid Cash could help maintain a healthy cash flow, it doesn’t remove the need to collect money outstanding from customers in a timely manner.
Yes, the standard security requirement is a business debenture and a personal guarantee for 10% of your maximum borrowing limit. This means the lending is secured, so NatWest can offer you lower cost borrowing.
Get an update on your application by contacting NatWest by emailing firstname.lastname@example.org or you can call 0330 808 7830.
How it works - using the service
Once approved, one of the final stages of the set up with NatWest Rapid Cash will include nominating which customers will make up your funding portfolio.
When setup is completed, you’ll be asked to nominate customers you’d like to advance against. If and when you need the funds you can draw down against their outstanding invoices. When those customers pay their invoices into your newly created NatWest account your facility is automatically repaid.
NatWest charges a small percentage of your facility balance which is calculated daily and applied to your account monthly.
Unlike invoice factoring, NatWest Rapid Cash is confidential and will never come between you and your customers. Your customers will not be aware that you have obtained finance against their outstanding invoices.
The Maximum Limit is the maximum amount that NatWest can offer you. It is determined based on a number of factors such as your turnover and the average value of your invoices over a six month period. Think of it as a bucket, and the maximum limit is the total volume of your bucket.
Your available funds come into play when you have been approved for NatWest Rapid Cash and the service has been set up. Available funds are calculated based on the amount of outstanding invoices from your nominated customers at any given time, this amount fluctuates as you issue new invoices and as your customers pay their bills.
You can use as much or as little of your available funds as often as you need to - up to your Maximum Limit. Using the bucket analogy, the available funds is the water in the bucket which you can draw down on as you need. And when your customer pays their bill, they’re essentially replacing the water you’ve used.
Eligible invoices are:
- Invoices that have been raised at the completion of providing a good or service
- That are aged no more than 90 days from issue date
- That are invoiced to other UK businesses (B2B)
- That are not milestone, staged or progressive invoices
No. NatWest Rapid Cash is a revolving service with available funds accessible as long as your business continues to issue invoices to nominated customers and they continue to pay their invoices.
If your overseas customers are billed in Pound Sterling (GBP) then you may be able to nominate them as part of your Rapid Cash funding. Please speak to a Rapid Cash representative for further information on nominating overseas customers.
After accepting the offer, NatWest will contact you to finalise your account. Once you’ve supplied the required documents the funds can be in your account within as little as 48 hours.
As NatWest integrates with Xero, your new NatWest Rapid Cash account will automatically be created within Xero. You’ll see this appear next to your existing bank accounts on the Xero dashboard, and your NatWest transactions will automatically import into Xero for easy reconciliation.
At the time of setting up your NatWest account, you will be issued with a new bank account and instructed to update your payment details on customer invoices that you’ve nominated to finance against. Payments made by your customers will pay down against any funds you have drawn. All excess funds will be transferred back to your normal bank account.
In the unfortunate event that a nominated debtor does not pay the invoice you’ve drawn down on, your outstanding balance will remain and you will continue to pay the daily interest charge until an invoice is paid by the same or alternative nominated debtor.
When you set up Rapid Cash, you will be asked to create a Rapid Cash account in Xero and assign it to the nominal charges/fees account you have in your Xero accounting package, once this is done the system will reconcile your monthly charge for you.
Your available funds will grow with your business – in the event that you need to access more funds than your maximum limit, all you need to do is contact the Rapid Cash in-life team who can turn this request around in a matter of days.
For help, contact NatWest by emailing email@example.com or you can call 0330 808 7830.
Yes. You will need to share some of your Xero data to be able to get a quote from NatWest. This is because NatWest needs specific information about your business and invoices to be able to let you know how much funding you can access.
You will need to provide consent for Xero to share your data with NatWest. Your data will be shared through a secure connection between Xero and NatWest and will not be shared any further.
Consenting to share your Xero data with NatWest allows them to access the information they need to assess your application, provide you with a live view of available funds and to manage your draw downs once your facility has been set up.
This access is controlled by you and you will be able to revoke access at any time during the application process. Your Xero credentials will not be shared with NatWest.
Providing NatWest with access to the information they need reduces the time and effort required to apply for Rapid Cash.
NatWest will access your business information and related financial information to provide you with an indicative quote, to assess your application, to provide you with a live view of available funds and to manage your draw downs once Rapid Cash has been set up. This information includes your invoices, credit notes, bank transactions, payments, profit & loss statement, and balance sheet.
When you give permission to share your Xero data with NatWest, your data is transferred through a secure connection that uses industry standard encryption technology. Your data will not be shared outside of NatWest.
Yes, you can remove permission for NatWest to access your Xero data, either from within Xero Settings or in the NatWest dashboard menu.
However, once approved and the facility is set up the connection between Xero and NatWest needs to be in place in order for you to continue using the facility.