These days small businesses are benefiting from invoice factoring to manage their financial assets. It can help cover any financial concerns, including income and company payroll. It can help you get a steady cash flow and cover all of your necessary business expenses.
Invoice factoring involves selling all of your business’s unpaid invoices to a factoring company. What this gives you in exchange is a cash advance, helping you get money quicker than you normally would from other sources.
You can choose from any number of factoring companies, and it is a simple process to go through. All you need to do is submit your invoices to the factoring company, wait for them to verify this invoice, and receive compensation for it.
This can happen all in a span of 24 hours, which is perfect for any quick transactions.
1. Use It Instead of Taking on a Bank Loan
Most businesses turn to bank loans when they need to secure funding for business expenditures. While it can be a steady and reliable source of funding, there are many factors that can get in the way of your loan’s approval.
You will need to meet all of the qualifications set by the bank in order to qualify. Even if you have secured the loan, you will eventually have to pay the bank back with interest, which isn’t cheap.
2. You Won’t Need Perfect Credit
Whether you are applying for a bank loan or seeking funding from investors, your credit score is one crucial factor for your qualification. If you don’t have a good credit score, your chances of getting that funding will be extremely low.
With invoice factoring, your credit score won’t matter. For factoring companies, qualifications for approval are based not on your credit score but the credit score of your customers. Even if you don’t have a credit score, factoring companies won’t take this into account.
3. Say Goodbye to Long-Term Contracts
If you don’t want to deal with minimums or long-term contracts, then invoice factoring is definitely your best bet. Minimums often influence the security of your funding, and you can’t exactly get out of a long-term funding contract when you want to.
With invoice factoring, you won’t have to deal with minimums and maximums, and you can stop transactions at any time. As long as you are meeting your sales goals, you won’t have any problems.
4. Cover All of Your Business Expenses
Invoice factoring is a great solution for covering any business expenses that you would typically need to secure funding for. When you are a small business, your capital cannot cover every expense you need to make. Invoice factoring will give you back the cash you already own but in a timely manner.
5. Get Money Faster
Say goodbye to long wait times for approval on your loans or anxiously waiting for funding to be approved. With invoice factoring, you can get your cash after 24 hours of your transaction. It is a great means of fast and secure funding for your small business.
Invoice factoring is an effective business solution to your financial concerns. If you want a quick and reliable way to secure funding for your business ventures, then you should do business with a factoring company today.
At Porter Capital, we provide invoice factoring services to help you get the money you need in a snap. We are working to provide capital solutions for businesses of any industry. Contact us today to get started.