Factoring finance is a very common form of financing, and it is estimated that it is used by around 50,000 businesses in the UK alone.
If you have never heard of this form of finance, then you will pleased to know that it allows the borrower the chance to receive cash almost within hours and should be seen as a massive cashflow benefiting form of finance. It normally works by a business selling it’s invoices to a third party, known as the factor, at a discount. This allows yourself as the business owner to have fast access to cash that you can use as you please and can help to ease many cashflow issues that you may be facing.
Every business at some stage of their lifespan will need a bit of help with their cashflow. It could even be a case that you are selling so much that you do not have the funds to pay for the raw materials or the equipment to make the next batch of products; and with invoice terms normally set around 30 day terms or even longer at 45 days or 60 days having to wait this long just sometimes is not feasible for running business operations.
According to historic records, factoring has been around for a very long time indeed. Historians can trace it back to the Roman Empire and further so has been around for around 1000 years or so!
There are so many befits of factoring and should certainly be considered by any business if you need some quick support with your finances. We all wish our customers would pay on time, or even immediately, however this is rarely the case. Having money in your bank is much more beneficial than lying around as a piece of paperwork; and with factoring invoicing you get the ability to receive cash very quickly. Normally, the fees can be made available to you within hours of applying!
This allows you to plan out your finances much better. Once you know exactly when money will hit your bank account you will have the chance to make plans more easier and take less risks. There is also a chance that you may be able to attract investors and borrow capital as you can prove a regular cash flow.
This form of financing can really help any one in the business to business sales sector and is fairly fast and straight forward to set up. You have the ability to borrow up to 90% of the value of the pre-paid invoices available and included debtor insurance too.
There are other products in this field which are industry specific including factoring, invoice financing, construction finance, recruitment finance among others.
If you would like to find out more about factor financing or to learn more about how myself and my team can support you then do be sure to get in touch. It all starts with a simple conversation.