What is Invoice Clearing, and how does it work?

Invoice Clearing is a financial process that allows you to settle invoices with minimal or no cash payments. Here is a simple example:

Let's say you're expecting payment on a bunch of invoices you sent out, and that they add up to $100,000. Let's also say you have a pile of bills you need to pay that add up to the same amount, $100,000. What you can now do is settle all these invoices by netting them out. As the total amounts are equal, there is no need to dip into your cash reserves.

If what you have to pay is more, you just pay the difference.

If what you are to receive is more, you will receive the difference.

Here's how it works in practice:

1. Record Keeping: Whenever you send an invoice to another business using your accounting software, the invoice is recorded on the Clearitt platform.
2. Balance Tracking: In this way, the platform keeps track of what you owe and what is owed to you, creating a running balance.
3. Invoice Settlement: Instead of exchanging cash for each invoice, you periodically settle your accounts. As mentioned, if you owe more than what's owed to you, you pay the difference. If the balance is in your favour, you receive the outstanding amount.

For a thourough introduction of how it works, go to https://clearitt.com/how-it-works.

Clearing has been used by banks and large institutions for over 250 years to simplify transactions and reduce the need for cash payments. Now, Clearitt brings this efficient, secure, and cost-efficient process to businesses of all sizes. 

By joining Clearitt's clearing network, you can streamline your financial operations, save time, reduce costs, and open doors to new cooperative opportunities within the Clearitt network. Say goodbye to the hassle of cash payments and embrace the future of seamless business transactions.