Invoice factoring is a financing alternative available to businesses that may not qualify or have an established relationship with a significant lender. Banks often base loan approval decisions on a business's assets and its financial and credit history. On the contrary, invoice factoring is an approachable way for businesses to access the funds currently tied up in their accounts receivable.
Here are some significant advantages of invoice financing:
A factoring relationship gives you a lot more than just immediate access to fast cash. Some of these advantages include:
Immediate funding: Applying for traditional business loans and other financing options can take months to get approved. With invoice factoring, your business gets direct access to cash to help alleviate the imminent financing needs.
Financial flexibility: We do not establish minimum or maximum amounts required to factor in each period. Your company can factor as much and as often as needed to maintain the cash flow needed.
No long-term contracts: Business owners will never be stuck in a long-term factoring agreement. Most agreements are valid for six months to one year, so owners can regularly review how the financing service works for them and make the appropriate changes when needed.
No business debt or collateral: Consistent and reliable cash flow access will allow companies to pay off debt without acquiring new debt. Typically when a company applies for a line of credit or a loan, the bank will demand business collateral upfront such as equipment, vehicles, property, inventory, etc. However, with factoring, businesses don't have to worry about pledging collateral.
Save time and money: Factoring services often will come with extra back-office services such as credit and background verification services to ensure you're selling to creditworthy clients.
24/7 access to the online platform: 1st Commercial Credit gives business owners 24/7 access to an online reporting system. Owners can freely access their account information and integrate their factoring account with other business records.
Take advantage of early payments: Your business will have the possibility to take advantage of supplier incentives like early-pay discounts, bulk order specials, and others.
Low credit is approved: Traditional financing will determine the funding decision based on credit score, collateral, and financing history. On the other hand, these are not required for factoring approvals. The factoring company is more focused on the payment history of the customer expected to pay the invoice. This means that the factoring company will be the one taking the risk of "non-payments" if these were ever to occur.
For the healthcare industry, waiting long periods before receiving payment is a regular thing. The issue arises when slow payers are hurting your business's cash flow and growth. If your business would benefit from getting paid sooner, invoice financing companies have the ideal financial solution with customized receivables financing services for the healthcare industry.
Two kinds of companies can benefit from accounts receivable factoring in the medical industry. The first type is a vendor that sells goods or provides services to the healthcare sector, for example, nurse staffing, transcription, etc. The second one is a provider that bills insurance companies, Medicaid, or Medicare.
With the financing services we provide, your business will have the financial means to expand, hire new employees, and even open more locations. With this type of alternative financing, there are no limits to the amount of funding a business can receive. Some companies benefiting from factoring healthcare receivables include medical staffing agencies, medical supply companies, medical billing services, temp nurse agencies, outsourced medical companies, etc.
Factoring focuses mainly on the quality of the receivables and the competency of the billing department. Therefore, receivable loan decisions are not based solely on the balance sheet that may show significant fluctuations. Healthcare providers are turning to medical accounts receivable factoring as a viable option to support their business growth.
Receivable-based financing creates reliable and predictable cash flow in an unpredictable payment cycle industry. Factoring companies can help providers that bill private insurance or Medicare/Medicaid for medical services and need to get paid sooner. Some examples of clients taking advantage of our medical staffing factoring for the healthcare industry include:
A factoring company (or accounts receivable factoring) converts invoices sold on credit terms for immediate working capital at a discount. It has become a simple, fast and easy way to access business cash flow. In comparison with a traditional bank loan, a company that factors receivables has a quicker approval process.
1st Commercial Credit is a factoring receivables company that specializes in evaluating accounts receivable and can make a prompt approval decision. The documentation requirements are not as lengthy, and the main requirement is that an applicant has invoices for work or orders that have already been satisfied. It also helps to have creditworthy customers. As long as a business has been in operation, meets revenue requirements, and is free of liens or legal issues, approval is likelier.
Thankfully, receivables factoring is a safe and stress-free financial solution and an alternative to bank loans that will stabilize a company's cash flow situation by releasing the cash tied to unpaid receivables. Factoring sees outstanding invoices as collateral that can be sold to a specialized factoring company. By doing this, businesses will receive a cash advance with each qualifying invoice. The amount of available capital that a company can receive will grow according to your business sales (invoices).
1st Commercial Credit offers funding for all businesses and industries in Missouri. Our receivable loans can be the ideal solution for long-established companies and startups to help resolve cash flow shortages and other financial struggles. Our invoice factoring services bring many benefits to businesses, including:
1st Commercial Credit is among the best factoring companies in Missouri. Our highly competent and qualified staff will design and select a complete financing program for your business. Our team will strive to fulfill all of your business's financial needs and specific goals. On top of this, our factoring services offer financial flexibility giving business owners the power to decide which invoices to factor in and when. This financing solution also doesn't involve long-term contracts, and our terms are favorable and flexible, meaning owners can choose how long to factor invoices for. We also offer many extra benefits like back-office management already included with the cost of factoring receivables.
The staffing industry is one that commonly has to deal with extended payment terms and slow-paying customers. These situations can cause cash flow shortages and cause a staffing firm not to fulfill some of its financial responsibilities. As a business, waiting a long time to be paid for your services can severely affect your ability to pay taxes on time and meet payroll. In addition, a lack of cash flow can prevent you from growing your agency and hiring new employees, and it can also keep you from taking on big contracts.
1st Commercial Credit is a specialized lending company providing alternatives and loans for staffing agencies with an efficient and fast application and funding process. Staffing factoring is a financial alternative for short-term or long-term financing needs for staffing firms in Missouri currently facing a similar situation to the one mentioned above.
1st Commercial Credit is a company that factors receivables for the staffing sector and understands the unique challenges it faces. We know that even well-managed, profitable small and mid-sized staffing agencies will experience cash flow challenges as they grow rapidly. We have dedicated time and effort to make our funding process for staffing agency loans is easy and accessible. We evaluate your company's needs and goals to provide you with a funding service to satisfy all of your business needs. Once a short 2-page application form online is completed and has been approved for a financing receivables program, we will give you the cash for the outstanding invoices within 24 hours. We provide payroll funding for staffing agencies when companies need it the most.