Accounts Receivable Factoring
Accounts Receivable Factoring is a great way to improve a companies cash flow, and today we are going to show you how.
The flexibility of Accounts Receivable Factoring is one of the biggest benefits to your company. Some people find invoice factoring to be cumbersome, yet it’s not so bad if you are working with the right factor. Most noteworthy, the finance company can often provide a bigger loan than a bank.
Factoring is important for your business, and below we tell you why.
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Who is Accounts Receivable Factoring for?
All businesses with open AR can use invoice financing to improve their working capital. Therefore, popular invoice financing industries include Wholesale, B2B Services, and Staffing companies. While accounts receivable factoring is great for large businesses, it also helps small growing businesses and startups as well.
Cost 10-25% per annum
Term 12-24 Month Commit
Set Up 3-8 Business Days
How do I qualify for Accounts Receivable Factoring?
Qualifying for Accounts Receivable Factoring is simple. First, you will want to complete an application here. A proposal can be issued as quick as 24 hours once the application is reviewed. Furthermore, you can email us at firstname.lastname@example.org with any questions.
How long does funding take for Accounts Receivable Factoring?
A new factoring client is easy to set up. As long as the necessary documents are in order, it’s a quick process. With factoring, we are looking at your customer’s credit worthiness. As a result, underwriting is quick.
Is a personal guarantee required for accounts receivable factoring?
Typically invoice financing does require a personal guarantee. Since the factor relies on your representation of quality AR, it is important to have a PG in place. The loan is supported by open AR, however that does not protect the lender against fraud. Many Accounts Receivable Factoring agreements are non recourse. As a result, the business is protected against the credit risks of credit approved clients. Therefore, it is important to request credit approvals before selling and invoicing a customer.
What can the factoring advance be used for?
Since you are taking a loan out against your outstanding Accounts Receivable there are no restrictions. As a result, these arrangements actually do not have many covenants at all.
Do I have to factor all of my receivables or can I be selective?
Spot Factoring or Single Invoice Funding is available if you choose not to factor all accounts receivable. Spot factoring is a great fit if you are looking for a short term arrangement.
Can I use Accounts Receivable Factoring for international customers?
Your customer can be located internationally, as long as they are credit approved. Flexibility is one of the major reasons why Accounts Receivable Factoring is such a great tool. Factors look at the strength of your customers, therefore it is a scalable program to help support your working capital.