Many businesses think that factoring is reserved for only certain types or businesses, or that factoring services can only be used in specific circumstances. The truth is that almost any business that issues invoices with payments schedules of 30 days or longer can use factoring. The experts at Single Point Capital have put together a list of the most popular reasons why our clients use factoring services.
1. Using Factoring to Accelerate Cash Flow
Waiting on customers to pay their invoices can cause major financial strains. While invoices with payment schedules of a month or more are standard, businesses still have overhead and payroll expenses, and waiting 30 days or longer to receive payments can create a negative cash flow. Factoring speeds up cash flow by turning unpaid invoices into cash within 24 hours.
2. Factoring as an Alternative to Debt-Based Financing
Businesses are not always eager to take out loans. Similarly, not every business is in the position to take on extra debt through loans, especially since lenders have been tightening their credit and collateral requirements. Factoring allows businesses to build up capital without placing debt on the books. The fast turnaround on invoices speeds up cash flow so businesses can grow their cash reserves while preserving their credit ratings, making it much easier to fund projects from within instead of jumping through hoops with traditional lending channels.
Traditional loans, cash advances, and other forms of financing have hidden fees and penalties that most borrowers do not see unless they dig through the fine print. By contrast, factoring is one of the most transparent financing services available. Unpaid invoices are exchanged for cash, less a small fee for processing. At Single Point Capital, we go one step further and provide a portal for clients so they can manage their accounts and see the breakdown of factoring transactions with us.
Get Started Today
Single Point Capital is a leader in invoice factoring services. We are committed to transparency, expediency, and helping our clients achieve their goals. Contact our offices today to get started with our factoring services.