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Factoring Finance
Invoice factoring is the purchase of a company’s outstanding invoices, where the invoice financing company advances 75-90% of the face value of the total invoice amount once the product or service is delivered to the customer. It’s like a real-time line of credit for immediate cash flow. The reserve, 10-25%, is given to the company when their customer pays the invoice.
Accounts receivable factoring is a great way to accelerate cash flow for your business and save you the management time typically tied up with credit analysis and collections. You can be advanced up to 90% of the face value of your invoices, allowing your company to cover its short-term cash needs without waiting weeks or months for customer payments.
The Challenge
Small and medium-sized businesses often struggle to build up their cash balance, especially when a company sells on terms, which can strain time and resources during the collections process. If your company is growing quickly or facing challenges, a low cash flow can lead to a range of issues. When cash is tight or collecting your accounts receivable is an issue, factoring can be the fast funding solution you need.
Factoring is an effective working capital solution when your business:
Your success or failure can hinge on obtaining fast financing.
- Doesn’t qualify for a conventional business loan, such as a bank loan
- Needs funds quickly to grow and expand
- Is managing a challenging transition
- Is constantly negotiating with customers and suppliers to fill gaps in the cash flow cycle
- Has large customer concentrations
- Experiences challenging seasonal demands
- Wants to avoid asking customers to pay early
Do these problems sound familiar?
Factoring your accounts receivable may be the answer. Whether you are a manufacturer, wholesaler, distributor, professional services company, importer or exporter and need from $500,000 up to $20 million, our factoring services can help you thrive.
The Solution
You can start with factoring as little as $500,000 and grow this factoring facility up to $20 million along with the growth of your eligible receivables.
Factoring allows you to:
- Access funds with a flexible facility and without restrictive covenants
- Grow at your pace with a credit line that grows with your sales
- Extend payment terms to your good customers
- Thrive even with large customer concentrations
- Take advantage of discounts and special buys offered by your suppliers
- Focus on your business, not on chasing your customers to pay on time
- Finance your insured foreign accounts receivable
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CBF focuses on the credit quality of your customers instead of the company’s financial history. We fund based on the value of your accounts receivable and not on prior profitability or the strength of the balance sheet.
When factoring your accounts receivable is purchased and immediately advance up to 90% of the money owed by your eligible customers. With cash in hand, you can get back to running your business. Once the payment from your customers is received, we send you the remaining balance, the reserve, which is the original 10% to 25% that was withheld from initial funding. The factoring fee is taken from the initial funding of the transaction, so you can expect to receive the full reserve once your customer pays for your goods or services.
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