Accounts Receivable Financing
The most important financial metric of a company’s day-to-day operations is the ability to generate cash flow and liquidity. By financing your accounts receivable, you have immediate access to liquidity rather than waiting 30, 60, or even 90 days for your customers to pay their invoices. We offer business owners the ability to finance their accounts receivable through both traditional lines of credit and factoring agreements.
With lines of credit, you can advance funds from the line as needed to support short-term cash flow needs. The line of credit is structured as a revolving credit facility, meaning that the funded balance fluctuates depending on the seasonality of your business and/or the payment tendencies of your customers. These facilities are typically collateralized by accounts receivable, inventory, and in some cases, equipment. They are typically governed by a borrowing base agreement which allows for maximum advance rates against each asset class (i.e., up to 85% of eligible accounts receivable and up to 50% of eligible inventory).
With factoring agreements, you sell your discounted invoices to the factoring company to receive immediate access to liquidity. By getting access to your funds now instead of waiting 1-2 months for your customer to pay, you take advantage of timely offers such as bulk discounts, seasonal sales, and larger orders. This type of financing is based on your customer’s credit history not yours, meaning that we can help businesses with damaged credit or have been hit by tough economic times.
Through one of our business finance specialists, we offer a program that specializes in providing short-term financing options for commercial construction companies by financing their progress/milestone billings. This program is unique as many banks restrict the ability to finance contract receivables in the construction industry.
- No fixed payments
- No personal guarantees or recourse
- Free credit insurance on your customers
- Get your money in 24 hours
As your receivables increase, you can expect the amount you are funded to rise also. You can use this money for inventory, expansion, payroll, and equipment. Get in touch with us today to speak to one of our financing specialists to learn more.