If your small business has been turned down for bank loans in the past, you may have become discouraged about the possibility of obtaining funds needed for cash flow shortfalls, or for accomplishing business growth. By using accounts receivable financing, you will probably be able to get the funding you need quickly, and have a much greater chance of approval than you would with any traditional lender. Here are some of the most important factors which are considered by alternative lenders during accounts receivable financing.
If your company has several or perhaps even many customers, which routinely place large orders that generate large invoice amounts, this will be seen as a favorable condition by an alternative funding company. Alternative lenders much prefer to work with a few large invoices, rather than many small ones, because once an alternative lender purchases your invoices, that company then becomes responsible for collecting on them.
One of the big advantages of accounts receivable financing is that it’s the creditworthiness of the customers which is primarily considered, rather than your own creditworthiness as the seller of goods. Since the cash actually comes from your buyers, it’s more important to an alternative lender that those buyers pay promptly, and that they have stable businesses.
Alternative lenders are generally not very interested in purchasing invoices which are either nearing the payment date or beyond it, because the likelihood is that these invoices may be difficult to collect on. An alternative lender is no more interested in pursuing late payers then you would be as a company, so the prime invoices of interest to an alternative lender would be those which have been recently generated, and those which are for relatively large amounts.
Accounts receivable financing with Skybridge Capital Group
If the nature of your business is such that accounts receivable financing would fit your circumstances well, we may be able to help you arrange for funding. Contact us at Skybridge Capital Group, and we can discuss how accounts receivable financing might work for your company, to put cash in your hands quickly, for important business needs.