Small Business Factoring: The Smart Choice

Invoice factoring for small business quickly converts receivables into cash.

Small business factoring is an excellent alternative to traditional bank loans and cash advances. Businesses selling to other companies or the government can use invoice factoring to improve their cash flow immediately. Even if you’ve had trouble qualifying for other forms of financing, invoice factoring is still a viable option.

A key benefit of factoring for small businesses is that the funding decision is based on the credit of your customers. So if your business sells to other businesses with good credit or the government, you’re a great candidate for invoice factoring.

Small Business Factoring

Our application is simple and fast. Fill out the contact form on the right to learn more.

Why Small Business Factoring is the Smart Alternative

Applying for bank loans can take months and there’s no guarantee of approval. The Small Business Administration noted that small business loan approval rates in Q1 2015 were 22% at banks and 43% at credit unions. Business credit card limits often max out well short of $100,000. This can be insufficient to cover your large projects or unexpected expenses.

On the other hand, small business factoring provides instant cash with no restrictions on its use. Factoring is NOT debt, therefore there are no limitations on how you use the funds.

Merchant cash advances can get you money quickly but the cost must be carefully considered. After doing the math, you quickly find out you’re paying over 70% effective annual interest for that fast cash. Cash advance lenders take daily repayment and are repaid fully in less than a few months. That daily payback can suffocate a small business. An executive at Etsy, a marketplace that hosts many merchants who are called on by cash advance salesmen, provides a detailed analysis of the true cost you’re paying.
If you’d like to learn more about how factoring works, check out our Invoice Factoring 101 Guide or call us at (310) 817-0376 to speak to a member of our team.

There are many benefits to factoring for small businesses. Below are just a few we’ve highlighted.

  • Fund payroll without worry
  • Hire new employees
  • Invest in sales and marketing
  • Expand production and manufacturing
  • Take on larger orders and customers
  • Weather seasonal sales and cash flow cycles
  • Pay off existing debt
  • Extend payment terms for your customers
  • Take advantage of early pay supplier discounts (can cover most of factoring fees)
  • Support daily operations with smoothed cash flow
  • Self-finance business during rapid growth without giving up equity
  • Lower overhead by reducing collections and admin expenses
Small Business Factoring Benefits Busy Entrepreneurs

Our easy-to-use online dashboard allows you to submit invoices, request funding, and receive instant notifications from your mobile phone or computer.

For factoring credit facilities under $250,000, we can approve within 2 business days. Once approved, same day wires can be sent upon request. We’re capable of providing up to $5 million credit facilities. So we can easily grow with your business. In addition to funding, our account managers can help you collect from your customers (but only if you’d like them to). This saves you admin expenses, reducing your business overhead.

We’re backed by an FDIC-insured bank partner. As a result, once you’ve reached a point where factoring may not be the best option anymore, the transition to bank financing is seamless. We can be a partner for your growth, every step of the way.

Our application process is easy and approval comes quickly. Invoice factoring is the smart alternative for financing your small business. You can reach us in a variety of ways: fill out the contact form on the right of this page, send us a message via chat below, or call us at (310) 817-0376 to get started. We look forward to working with you!

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