Invoice Factoring

Invoice Factoring A Better Alternative Than Traditional Bank Loan What is Invoice Factoring? Invoice Factoring is a form of invoice finance in which the business hands over credit control to the finance provider. It is a type of cash flow funding that allows you to receive money from unpaid invoices as soon as they are raised. How Does Invoice Factoring Works? Step 1: Invoice your customer for goods or services sold and send a copy of your invoice to the lender. Invoice Copy Lender You Invoice Copy Customer Step 2: Lender gives you 80% to 90 % of the value of the invoice. 80% to 90 % of invoice value Lender You Step 3: The lender will chase your invoice with your customer. Chase Invoice Lender Customer Step 4: Your customer pays the Lender 100% of the invoice. 100 % of invoice value Customer Lender Step 5: The Lender gives you the remaining 10% to 20% of the invoice minus the charges. 10% to 20% of the invoice value minus charges Lender You Benefits of Invoice Factoring Invoice factoring benefits businesses who provide terms for their clients and are not paid for 30 to 90 days. Up to o% of the value of receivables can be factored to assist businesses. Factoring eliminates serious cash flow problems. Factor evaluates the creditworthiness of the client's customer and can fund within as little as 24 hours. Invoice factoring companies can be a lifeline for new or small businesses who are not getting loans from banks. Worldwide Factoring Industry 2013 Statistics 26 69 29 66 Hong Kong (36%) Russia (35%) China (15%) Mexico (14%) MAJOR MARKETS GROWTH Total Factoring Volume ($Billions) In the Year 2010 11 22 3 63 Europe (63%) America (11%) Asia (22%) Africa (1%) Australia (3%) Created By: S STERLING COMMERCIAL CREDIT Piktochart I make information beautiful