Why consider receivables funding?

Due to the willing or unwilling extension of the credit period by your customers, your cash flow can become constricted. To solve this problem, finance companies offer accounts receivable funding, which is also known as accounts receivable finance, receivables finance, receivables funding, or account receivables factoring.

10 Reasons to Consider Receivables Funding

1. Consider receivables funding to boost your operating cash. This is the prime reason why numerous Fortune 500 companies opt for accounts receivables funding.

2. Consider receivables funding to get access to immediate cash against the total value of your outstanding accounts receivables. Here, the finance company, as an example, gives 90% of the amount of your invoice and the remaining 10% less fees of the finance company is paid to you after your customer honors the invoice. This frees up your cash which can be used in any way you choose.

3. Consider receivables funding to directly link your cash flow funding with it. Your business is injected with more cash, in direct proportion to your sales growth.

4. Consider receivables funding if you need cash from other sources besides the traditional bank loan, mortgaging real estate, keeping personal or business assets as collateral, or disinvestments in equity. Receivables finance is considered as an advance and not as a loan, hence it is not borrowing. This affords a fruitful impact to your profitability.

5. Consider receivables funding to eliminate early payment discounts to your customers. You can also give more credit to special customers who purchase in bulk. Again, you can bargain better discounts on purchases made in bulk from your suppliers.

6. Consider receivables funding to allow timely payment of your taxes, liens, or payroll.

7. Consider receivables funding to avail the services of the highly trained, courteous, and experienced staff of the finance company. This multilingual staff can prepare and send out statements, keep in touch with your customers via telephone, fax, email, and chase and collect payments from your clients. They also maintain professional, accurate, and detailed accounts of all your transactions. Most finance companies offer the above value added services at an extremely affordable and a nominal fee. The fee generally comprises two segments, where one covers the cost of capital used while the other covers the cost of the service provided.

8. Consider receivables funding to remain in total control of your business. Although the finance company may undertake to chase and collect your various invoices, with a 24-hour link via the Internet, you can have access to all the records of your transactions which are undertaken by the finance company.

9. Consider receivables funding to have sufficient funds ready to fuel growth. As all the back office operations are taken care of by the expert staff of the finance company, you can concentrate on pursuing and executing orders.

10. Consider receivables funding to avail factoring services; thereby, improving the cash flow and enabling to smoothly negotiate the initial difficult months.

Article Source: http://www.ApprovedArticles.com

Alistair Charles on behalf of Bibby Financial Services. Bibby Financial Services provide receivables funding to small and medium-sized enterprises. View a summary of our receivables finance service.

Please Rate this Article

5 out of 54 out of 53 out of 52 out of 51 out of 5 

Not yet Rated