#Best invoice factoring how to

When your business is ready to expand, you need the cash to support that growth. Reason #4: Your Business Will Have a Chance to Grow It is not uncommon for a minimum credit score of 730 to be required for bank loans and a score of 670 or higher for credit card companies.Īlthough a credit check and your business’s payment history are part of the credit evaluation process, factoring does not necessarily require high credit scores for your business to be approved for funding. While the requirements will vary depending on the lender or financial institution, it’s fairly typical for banks, and credit card companies to prioritize or even require higher credit scores. Reason #3: A High Credit Score Is Not Required This typically provides enough liquidity to meet your business’s cash needs, regardless if it’s for hiring, purchasing raw materials or making payroll.

Reason #2: You’ll Receive 80 – 90% of Your Invoice as a Cash AdvanceĪt ei Funding, we advance 80 – 90% of the face value of your invoices.

Although we do depend on specific information to be provided in your application before we get started, we do our best to get you set up quickly, often as quickly as 24 hours from pre-approval.Ĭompared to bank loans, merchant cash advances and other traditional forms of business financing, invoice factoring is fast and convenient. In our experience at ei Funding, we’ve learned that the thing that’s valued most from our clients is not the fast setup, but rather the fast funding - in the correct amounts, when and how you need it. Other costs associated with your business.With factoring, you can quickly and easily pay for: The increased cash, in turn, helps meet your growing business’s operational needs. Invoice factoring provides immediate cash for your operations. Reason #1: Invoice Factoring Provides Rapid Funding Regardless of the industry you are in, the benefits of Invoice factoring include the following items. Why Is Invoice Factoring the Best Option? They are the ones who will provide the advances against your invoices for the delivery of your products or services, and as part of the service, also manage the Collections of payments from your customers for you. It’s cheaper, faster and lower risk compared to traditional bank loans, credit cards, merchant cash advances and other forms of business financing.Ī factor is a third-party entity that performs your invoice factoring for your business. Invoice factoring is the selling of business invoices (account receivables) to acquire cash for business operations. Compared to other traditional forms of financing, factoring is low risk, quick and considerably easier.īut let’s first ensure we’re on the same page by defining what invoice factoring means. Invoice factoring is an effective option for businesses with immediate funding needs, bridging the time gap between your point of sale and the time you receive payment from your customers.

#Best invoice factoring how to

So if you’re struggling to keep up with rapid growth and wondering how to get funds quickly for your business, it pays to know your options. (After all, companies need capital resources to take on new projects, hire new talent, expand their inventory and grow.) Yet attaining and maintaining a strong cash flow - especially in the beginning - can be daunting for growing businesses. Having sufficient cash flow is necessary for a business to maintain and expand their operations.