Invoice Factoring and the benefits to business
Invoice factoring can benefit you, as a business owner, want working profit money to pay the fund growth to pay bills or negotiate discounts, then you need to study the benefits of invoice factoring. All the businesspersons, at some point of time experience the money deficiency and flow of money as well. Banks sometimes decrease the credit extensions and with that, the credit options for business persons decreases. After many years of continued growth, accounts receivable funding is going strong fortunately. Options like invoice factoring are now very flexible and cheap that has never been before.
Top Benefits of Factoring Invoices are as follows:
Fast Access to Cash
The process of factoring is very fast and easy. Refunds are also provided within 24-48 hours on the invoices, which are approved. It is much faster as compared to the other traditional methods of taking loans from the banks or business.
Flow of cash without Debt
It is to be noted that invoice Factoring is not a loan, as it does not add on the balance sheets. This means you do not have to pay monthly and your balance sheet is very clean.
Flexible Terms
Most of the today’s factoring programs do not have long-term contracts, maximums or minimums. According to the type of invoices, you want to factor, choose the option. Factoring is a process, which is made to make you grow, with your sales and funds growing together.
Reasonable Factoring Charges
Factoring cost had come way down than it was in past years. The advances are there up to 95% and the fees are now 1.5% less than earlier. However the fees also depend upon various factors such as volume, advance rates and customer’s period, number of invoices, customer creditworthiness and the size of the industry.
Stay In Control
What you need is cash, not boss. The factoring companies do not tell you how to spend the money. You do not have to buy any equipment or anything.
Relieve Pressure
There is no need to wait for your customers to pay so that you can pay for yours. Now you can meet payroll, pay bills and give taxes on time without even upsetting on late fees or bad credit score.
Rise the Bottom Line
Numerous companies take help of invoice factoring to raise the fund growths or profits. For the funds to expand, companies take advantage of the early payments discounts, rise inventory for big orders, adding staff or members, bargain bulk discounts from dealers. Factoring can also be used as a way to make money or to save money if used thoughtfully.
No requirement of strong financials
To qualify for a factoring service, you do not need to have good credit, a long solid financial history of years in business. The factoring company is more dependent on the ability of your customers paying the invoices in spite of you. If you are trying to build your business and have a credit score full of bumps, then this is good news for you.
