Tuesday, June 27, 2006

Benefits of Factoring

The benefits of factoring (also known as accounts receivable purchasing) are many and include the following:

  • Accelerate your cash flow by receiving funding in as little as 24 hours once approved
  • Faster receipt of cash enables you to more quickly pay your suppliers, take advantage of vendor discounts and improve your credit history
  • Funding does not appear as debt on your balance sheet
  • Access to capital without diluting your ownership position
  • Can reduce overhead in collections and administration of accounts
  • Based upon your customer’s credit – a big advantage if you’re a startup or experienced financial difficulties
  • Your access to funding grows in parallel with your sales
  • Advance credit screening of your customers can result in lower bad debt expense
  • Can provide unlimited access to increased funding without lengthy approval processes required to increase a normal bank line of credit
  • Expands your geographic reach – many factors can fund both domestic and international receivables

Click here to read "Matchmaking for Business Loans"

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