Invoice factoring is a helpful way to keep up with the amount of cash owing to your business.
Small businesses often struggle with having enough cash flow to sustain the business. Invoice factoring is a helpful way to keep up with the amount of cash owing to your business, especially when you need cash as soon as possible. Also known as ‘accounts receivable finance’ or simply “factoring”, is a type of business finance that can offer a quick boost to your cash flow.
Invoice finance factoring is when a third party (a factoring company) can buy your invoices in exchange for a lump sum of cash. Then, the factoring company owns the invoices, and they get paid when the late invoices are paid. Instead of waiting for your payment through invoices, you receive immediate funds to continue the business running. Most of the time, businesses will receive 80% of the invoice value immediately. Depending on arrangements, the collection of invoices can be managed by the factoring company. Read the definition on Wikipedia.
For instance, a customer buys your product for $5,000. However, they agreed that the invoice would be paid within 30 days. You have urgent fees, wages and expenses to pay tomorrow. Invoices that you are waiting for can be bought by a factoring company at a discounted price for immediate cash. For instance, if it was discounted, the business will receive 80% of the invoice value. In this circumstance, the business would receive $4,000.
There are some major benefits to factoring, especially the immediate cash injection for your business. Other advantages include:
At Every Business Loan we have developed a one to one approach that allows us in 99% of the cases to get the money in our clients’ bank account within 1 day from the application. With our network of 50+ business loan providers, we open credit opportunities for your business.
We help you through the process and we put you in contact with the lender that offers the type and size of business loan that meet your needs. Our partners assist eligible small businesses with invoice factoring.
Every Business Loan is the preferred and trusted finance broker for hundreds of small and medium local businesses in Australia. It all starts with an enquiry. Call us 1300 920 905 or click on “get started now” and we call you back to see if you qualify for invoice finance factoring.
Our lenders usually require a combination of the below as a part of an application:
Every Business Loan is a leading and trusted finance broker that makes the process of business funding fast and easy for all our clients throughout Australia.
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