Written by Invoice financing helps businesses make predictable moves and better decisions. You can free up access of capital by providing up to 85% of the value of unpaid invoices on the spot, instead of when terms are due. This gives small businesses the peace of mind and cash flow to help them manage their day-to-day expenses, payroll, or bankroll inventory. You can finance invoices ranging from $10,000 up to $1 million.
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Common invoice finance questions answered
We can finance $10,000 to $1 million in unpaid invoices.
The lifeblood of business is cash flow. Businesses use invoice financing to speed up cash flow otherwise tied up in unpaid invoices. Instead of waiting 30, 60, or even 90 days for payment once services or products are rendered, your business can access 85% of the payment instantly, giving you more flexibility and peace of mind.
Invoice financing costs nothing up front. However, fees are taken out of the factoring fee. Usually 15% of all invoices are kept in reserve to cover this factoring fee. They can vary from 1.00% to 4.00% or 5.00% per week during the non-payment period.
Yes. They will be paying the invoice back in full once it is due.
No. The invoice is the security.
Your invoice finance provider reserves the right to enter into debt collection arrangements if your customer fails to pay the amount outstanding.
Typically, invoice factoring applications take about 3 to 5 days for assessment.
The number one businesses enter into invoice financing is smoothing out bumps in cash flow. Waiting for cash flow can cripple a business. They may not be able to pay their employees or order more inventory. Short cash flow can also restrict a business in how they can grow or take advantage of opportunities. It also frees up resources on staff, who may need to chase up invoices and other financial services.
If you run a business, you have had to deal with clients who are late on paying invoices. One step is to address the elephant in the room and prepare for implementing payment plans if necessary. Sometimes letters of demand and legal action are required. A second plan is to use invoice financing so the debtor arrangements are handled by a third party, which can ease strain on business relationships.
