Invoice Factoring: The Smart Way to Get Paid for Your Services, TODAY!

 

Waiting for payment is one of the worst things that you have to do while running a business. Some clients usually prefer generous terms, while some are painstakingly slow in clearing payment (yes, we are thinking about government offices and corporate clients too). It may be because of long verification processes or long payment cycles. Sometimes, payment cycles are lumpy and seasonal. You can factor your invoices to receive working capital. You can invest this amount back in your company. Invoice factoring is not a new concept; only the terms have evolved, keeping the interest of the smart entrepreneurs in mind.

What is invoice factoring in reality?

If you have some invoices or receivables, you can sell them to a factoring company. This company will clear the payments in exchange for a small factoring fee. This way you can free up your receivable cash. You may already know this by other terms including “Invoice financing,” “accounts receivable financing” and “receivables factoring.”

Why should you go for invoice factoring?

Once you have made a sale, you would, of course, want to see some money. Now, when a client asks for a generous payment term, this could mean a payment delay of 30 days to 90 days. There is no guarantee as to when the customer will clear the payment, though you have the papers showing a completed sale. In this position, you can find yourself in a tizzy. You will have other projects and possible business expenses that will require cash. However, your payment will be caught up in some bank procedure or corporate treadmill. In such a situation, you can come to us with your pending invoices, and we will give you the amount you deserve.

Who pays us?

We usually charge our clients a minimal processing fee. However, your clients pay us. It is quite simple. When your clients buy a product or services from you, you have an invoice as the proof of the sale. When you give us the invoice, we immediately pay you about 70% to 90% of the amount. After your client(s) pay the invoice, our outstanding fees are cleared. We are giving you the money instantly, so you can pay your employees and business expenses while we wait for your client to pay us.

What are the benefits of working with a factoring company?

Every business decision has its pros and cons. Most of the times, the pros, and the cons vary according to business situations. We have enlisted a few certain benefits of working with a reputable receivables factoring company like The Bay Area Loans.

1. You won’t have to wait for the payments to come in. You can clear all your pending payments including paying for other debts.
2. You can use the amount to promote your next project. Moving on with the next projects opens new paths for more profits.
3. You can clear multiple invoices at once. This way, you will have to pay less processing/factoring fees to your company.
4. Exacting payments from your clients now becomes our headache. You already have your payment in cash against the submitted invoices.
5. It is not a loan. It is money you have already earned or profited.
6. We don’t check credit scores or bank records. Just a few business details and business profiles are enough for us.
7. It is a fast process. You may have to wait as less as 24 hours to 48 hours for the processing and payment.
8. You can apply for the factoring online. Registering online is a child’s play. You will need to provide your full name, contact details, business details, and residential address. You already have the documents we need in your business folder. Once you leave a message with us, our executive will reach out to you with all the details. You can do all this from the comfort of your house.
9. Due to the fewer number of intricacies involved, the rates of invoice factoring approval are quite high. It automatically means, even if banks have denied your applications for conventional loans, you can get financial assistance from us.
10. Invoice financing enhances your bank credit scores if necessary. Thus, you will find it much easier to apply for other larger loans from banks shortly.

Who can benefit from factoring?

Factoring is very common in almost all the fields of business imaginable. We have seen PR professionals, marketing firm owners, IT Company executives, wholesale traders and online sellers come for invoice refinancing. Almost any business that can generate an accurate and verifiable invoice can come to us for a refactoring service. Another requirement for nearly all factoring services is a payment cycle of 30 days to 90 days maximum.

Who does not qualify for invoice refinancing services?

Most B2B companies and other businesses that do not issue any invoices do not qualify for refinancing and factoring services. Firms that are paid on delivery are not eligible for invoice factoring either. As a matter of fact, these companies simply won’t benefit in any way from invoice refinancing services.

How to find the right factoring company?

Since this is quite an old practice, there are millions of companies worldwide that provide this kind of service on varying terms. It makes it trickier for novices to find the right company that can be trusted. Handing out invoices is a risky move. You need to be able to hope the factoring company with your client details. Here are a few things you need to check more than once while choosing your factoring company:

1. Hidden penalties for late payments
2. Hidden fees for factoring services
3. Ways of exacting payments from clients
4. Client reviews and ratings
5. Number of years they have been in business

Although these are not foolproof methods, they provide some amount of security. To get a clear idea of how an ideal factoring process should play out, visit https://bayareatitleloans.com/or drop by at the Bay Area Title Loans.