Financing & Factoring Oilfield
0.69% to 1.59%
Account Receivable Financing is our Business:
Invoice Factoring and Receivable Finance for the Oilfield Service Industry
Invoice factoring and receivable finance for the oilfield service industry involves selling outstanding invoices to a factoring company to improve cash flow. Oilfield service providers often face long payment cycles from clients, and factoring allows them to receive immediate funds by selling their unpaid invoices at a discount.
At 1st Commercial Credit, we can provide your business with working capital by using your accounts receivable as collateral.
This type of financial service is available to oil and gas exploration service providers and field equipment suppliers such as seismic survey or geophysical operators, manufacturers of drilling fluids, drill rigs, lifts, geophysical prospecting equipment, pipes, pumps, production tools, valves, wellheads and many more.
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Is your money tied up in 30 to 90 day terms to your customers?
Fast Approval Process
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3 to 5 Day Initial Setup
No invoice minimum fees
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We offers receivable finance for manufacturers experiencing working capital shortages
Fast Approval Process
3 to 5 Day Initial Setup
No invoice minimum fees
We Provide Receivable Based Financing for the Oilfield Industry
There is no need to borrow money if you have uncollected receivables from good credit worthy accounts. Oilfield Service companies have to sell on open credit terms. Due to the nature of long collections in the oil and gas industry, accounts receivable financing become a tangible asset that is easily taped into liquid cash flow.
Many large companies use this type of financing to increase their cash flow for daily expenses. There is no need to borrow money if you have uncollected receivables from good credit worthy accounts.
1st Commercial Credit offers an ideal financial solution that will advance a portion of your outstanding accounts receivable. We will provide your oilfield services company with the cash flow it needs to meet ongoing and pressing obligations. Once the transaction is settled and your customers pay their invoices fully, the factoring company will forward the remaining balance minus a small factoring fee.
Invoice financing can provide your company with the financial flexibility and the capacity to take on new customers without worrying about slow payments and cash flow issues.
1st Commercial Credit Offers Factoring Services to Small and Large Oil Service Companies
1st Commercial Credit offers factoring services to small and medium-sized businesses with as little as $10,000 a month in sales volume and up to $10 million in receivable assets. If your business would benefit by converting your accounts receivable to working capital, we can help.
Get initial funding in 3 to 5 working days. No financials needed, No up-front fees to set up, it is that easy.
Service companies that are in the oil and gas industry that need to offer credit terms to customers utilize our funding program. Oilfield companies can easily tap into their receivables asset for immediate cash flow.
You may offer credit terms to new and larger customers at an affordable cost, take advantage of early pay discounts offered by your suppliers, buy larger quantities with additional discounts, and countless other opportunities that your oilfield business is missing out on.
Unlock Reliable Cash Flow Solutions for Growing Oilfield Service Providers
The oil and gas industry has continued experiencing growth all across the nation. This growth is fueling great opportunities for companies in this sector, and services such as oilfield transport have been increasing in demand. However, with all this rapid growth and increase in demand, financial hardship can ensue for some of the smaller providers in the industry.
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Most small businesses have a difficult time obtaining financing, which can set them up for failure. Invoice factoring for oilfield companies is made easy with 1st Commercial Credit. We provide the most cost-effective and reliable accounts receivable loans.
Most oil and gas clients will pay their invoices in 30 to 90 days. Therefore, most customers require these payment terms. The problem arises when many smaller oilfield service companies do not plan for this situation, resulting in problems for companies that need to cover daily business expenses.
1st Commercial Credit offers flexible invoice loans. If your customers have good credit, the invoice financing line can grow alongside your company sales. This type of flexibility is a significant advantage of invoice financing, especially when compared to other financial solutions. We offer strategic benefits to oilfield services companies experiencing cash flow problems and can make quick funding decisions. The cost of factoring receivables is dependant on the following factors:
- The volume of the monthly receivables a company wants to factor
- The size of each invoice
- Industry
- The creditworthiness of your clients
- The length of time your customers take to pay
Does Your Oilfield Business Need Factoring?
If your oilfield company faces some of the followings, it means that you probably need to work with a factoring company:
Will my business qualify for invoice factoring with 1st Commercial Credit?
Factoring is a form of financing that helps improve a company's cash flow. This financing alternative gives the client access to immediate funds, which can then be used to pay for business expenses and grow. It is important to mention that qualifying for factoring is considerably more accessible than any other type of business financing.
To know if your small or large company would be eligible for accounts receivable funding, here are a few of the main prerequisites:
- Your customers must have good credit: This is the most essential requirement to qualify for factoring. The transaction is built by leveraging your customers' credit strength and not yours or the company's.
- Your invoices must be free of liens: Factoring companies provide financing by purchasing your invoices. But to be able to do this, your invoices must be free of liens.
- Need to have good invoicing practices: Your invoices must have clear and well-defined payment terms and must have all the necessary backups for a smooth collections process.
- Tax issues must be manageable: A significant advantage of receivables factoring over other solutions like business loans is that it is available to companies with tax problems. However, these tax problems must be manageable and solved with financing.
- No open bankruptcies: The company and the primary owners must not have an active bankruptcy, and previous bankruptcies must be adequately discharged.
Oilfield Providers Experiencing The Following Can Take Advantage Of Our Financing Programs:
Invoice factoring is an excellent alternative for those businesses looking to alleviate different types of financial issues. It is easy to determine if factoring will help your business by asking yourself the following questions:
1. Your financial problems are arising from slow-paying customers or extended payment terms
Most companies finance their receivables because of cash flow problems. If finding a way to obtain these payments sooner by using a cash flow lender would eliminate most of your financial problems, factoring is the solution.
2. Customers keep asking for payment terms you can’t afford
Sometimes companies experience problems when their customers demand 30 to 90 day payment terms. Their current financial situation is often not large enough to cover company expenses while also waiting for customer payments. This puts them in a predicament.
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3. You have to turn away orders because you do not have the money to fulfill them
There are times when a company has to turn orders away because it does not have the cash available needed to fulfill these orders. This can sometimes push potential customers to a competitor. This problem is common for companies but can be avoided when using invoice factoring for oilfield companies. Oilfield factoring is financing used by many companies in the country, and 1st Commercial Credit has the experience and can advise how to maximize the value of your outstanding invoices.
Oilfield Factoring vs Traditional Bank
Oilfield factoring is a more efficient financial solution compared to traditional bank loans. Bank loans come with strict qualifications, often requiring excellent personal credit and significant business collateral, along with a lengthy and complex application process. For oilfield businesses, this can delay access to much-needed capital, taking weeks or even months for approval. With factoring, oilfield service companies can bypass these rigid requirements and receive immediate cash flow to meet operational needs.
In summary, here are the main 5 difference when comparing a bank loan to factoring invoices:
- No collateral is needed
- Fast application and approval process
- High probability of approval
- Low credit score admitted
- Quick cash - enhanced cash flow
Oilfield Factoring Cost (Rates and Fees)
When considering factoring services for your oilfield service company, understanding the costs involved is essential. At 1st Commercial Credit, we offer competitive and transparent rates, typically ranging from 0.69% to 1.59%. These fees reflect the speed and flexibility of our cash flow solutions, ensuring you can access funds quickly without hidden costs. Whether you need capital to cover payroll, manage equipment expenses, or take on new contracts, our factoring rates provide a cost-effective way to stabilize and grow your oilfield business.
FAQ About Oilfield and Factoring
Factoring provides quick access to working capital, allowing oilfield companies to cover operational expenses such as payroll, equipment maintenance, and fuel costs. It is especially useful for businesses with long payment terms or those experiencing rapid growth but lacking sufficient cash flow.
Oilfield service providers, equipment suppliers, transport and logistics companies, pipeline construction firms, and maintenance services can all benefit from factoring. Any oilfield business dealing with delayed payments from clients can use factoring to manage cash flow.
Factoring focuses on the creditworthiness of your customers, not your business’s or personal credit. This makes it an accessible option for companies that may not qualify for traditional bank loans.
Factoring can be used as a short-term or long-term financial solution, depending on your company’s needs. Many oilfield businesses use it during periods of growth or cash flow shortages but may choose to continue using factoring as a regular financing tool.
Yes, factoring provides the cash flow necessary to take on new projects, purchase equipment, and expand operations without worrying about payment delays. It allows your business to scale while maintaining financial stability.
