How invoice factoring works, and how it can benefit you
Invoice factoring, also known as accounts receivable factoring, is a form of working capital financing for businesses selling goods and services to other businesses on credit. By “selling” their invoices to a factoring company, a business has access to instant cash, professional accounts receivable management, and up to date credit information.
Who Can Use Invoice Factoring?
Any B2B business selling its products and/or services on credit terms (i.e. net 15, 30, 60, etc.). Business can be early stage start ups or tenured entities with annual revenues up to $60 million.
Invoice factoring can help businesses increase cash flow while reducing credit and collections headaches. In addition to cash flow, factoring provides professional accounts receivable management, which allows business owners to focus more on operating and growing their businesses. Factoring allows businesses the flexibility to choose the frequency and amount of invoices they wish to factor, depending on their working capital needs.
Factoring can assist businesses within a wide range of industries such as:
- Government contracting
- Oil & Gas
- And many more.