Wednesday, February 24, 2016

Accounts Receivable Finance For Small-sized Businesses

Did you know that it is too tough to secure a loan, especially if you have a small-sized business and your credit history is not exactly up to the mark for whatsoever reason? However, if you need cash immediately because you have sold all your products on credit and are yet to receive the payment from your clients, how will you satiate your requirement, now that you know that even a bank may not be able to help you in your time of need? And, what about the exorbitant rate of interest that you will have to take care of? Fortunately, you can rely on receivable finance.


Finance


Funding option for businesses of all sizes
As already mentioned, a bank is unlikely to come to your rescue if you either have a small-scale business or have just entered the market. In fact, your credit history can also be a big deterrent, and may stop the bank from helping you. In such a situation, you need an option that is just as good for businesses of all sizes. This is when factoring comes into the picture as it can provide you with immediate cash without any difficulty. You just have to find a company that's engaged in factoring accounts receivables, submit your invoices, and then you can get your payment, which in some cases can be up to 85% of the value of the invoice(s).

Mentionable benefits of factoring
Unlike a typical bank, a company that's engaged in factoring accounts receivables is not going to make you wait for a week or so unless otherwise specified. In fact, within just a day or two, you will get the approval, and can therefore plan your activities accordingly. Furthermore, you won't even to have to wait for too long to increase your cash flow and alleviate your funding issues as your payment is likely to be released as soon as possible. Therefore, if you opt for funding, you not only embrace an option that's fit for businesses of all sizes, but also save yourself the trouble of having to wait till your issues aggravate.

Be wary when considering receivable finance
If you do choose a company that's into factoring, always read between the lines and specifically look for terms and conditions that have not been conveyed to you upfront. For example, if you do not find out the smallest invoice (w.r.t amount) that can be factored, you are far from making the right decision.