Accounts Receivable #Financing Part 1: A (Very) Brief History, What it is, and How it Works
Accounts Receivable Financing and How it Works
Over the next few weeks, I will be publishing a series of posts that cover the topic of accounts receivable financing, "factoring", and how it can solve your business challenges today.
Factoring is one of the oldest forms of finance. In fact, it has been around since biblical times and comes from the Roman word for "he who gets things done" (Tatge, American Factoring Law, 2009).
Factoring is a financial transaction whereby the factor will purchase receivables from a company at a discount in exchange for immediate cash and title to the accounts passes to the factor upon transfer of cash. The party responsible for paying the invoice is known as the account debtor.
We can show you how you can leverage your accounts receivable, providing cash now for growing business tomorrow.
Great fits for factoring:
- Manufacturers, service providers or distributors in all sectors
- Start-ups
- High-growth mode businesses
- Lean cash flow but healthy receivables
- Fast cash for new venture or turnaround
- Companies turned down by conventional financing, asset-based lender or private equity
Factoring is a proven alternative to a traditional bank loan.
We regularly work with companies that lack capital but certainly not a vision for the future. We aim to make factoring as convenient as possible. Our clients do not have to worry about arbitrary board decisions and will gain the freedom to focus on doing business instead of worrying about their AR payments coming in. Contact me today to learn more about this valuable program.
For those of you who have used a factor before, I would love to hear about how it worked for you.
Read part 2 here: 5 Reason To Consider Factoring