Best Small Business Factoring Company

Factoring Company Summary

The best small business factoring company, Bankers Factoring, turns unpaid accounts receivables into working capital for entrepreneurs and startups. Factoring financing also starts with an easy online application and a first funding process that takes 3-5 days. So, if your small business has unpaid invoices, factoring financing provides bad debt protection and cash funding for the not-yet bankable business.

Among your many choices in invoice factoring companies, having a company that understands your industry and takes the B2B business credit risk (a non-recourse invoice factoring company) as part of their factoring security services is best.

The Best Small Business Factoring Company 

Picking the Best Small Business Factoring Company

Small Business Factoring Financing to overcome cash flow gaps 

Almost 20% of startups fail in their first year due to financial mismanagement or poor financial planning. Small businesses, startups, and entrepreneurs have financing needs different from those of major corporations and publicly traded entities.

So, when small businesses begin to grow their sales performance, cash flow gaps follow due to offering extended payment terms. Furthermore, small businesses struggle to secure traditional funding in their early stages. Therefore, business owners need an alternative funding source to avoid burning their life savings.

You can also read sell you invoices to the best factoring company.

Thus, the Best Small Business Factoring Company, Bankers Factoring, works with startups and entrepreneurs to resolve funding issues. Bankers Factoring has helped small businesses go from negative cash flow to growing in challenging market conditions.

hat makes the best small business factoring company?

• The fast and easy funding process
• No balance sheet debt
• Most invoice factoring companies don’t also offer PO funding.
• Bankers Factoring takes on the credit risk – we provide AR Insurance
• Financially distressed businesses can qualify
• Low factoring fees
• Same-day funding with up to 93% cash advance on outstanding invoices
• No hidden fees
• Access to unlimited working capital

What is small business factoring?

Small business factoring financing is a form of commercial funding available to startups and unbankable small businesses. It helps small entities overcome cash flow gaps by accelerating accounts receivable (AR) payment cycles.

Small business factoring, also called factoring financing, AR factoring, invoice financing, or invoice factoring, is a standard solution for a business lacking cash reserves or working capital. Contact Bankers Factoring today and work with our small business factoring team if your business struggles to secure financing.

Please read what is business factoring and more about security service factoring for small businesses.

Why do small businesses need factoring financing?

Factoring financing provides liquidity injections for small businesses that cannot obtain traditional financing, such as SBA Loans or bank lines of credit. Small companies in growth mode need additional cash for payroll funding, sales and marketing, and general expenses. Small businesses can run into cash flow shortages by extending credit terms to their customers without the available financing.

Reasons why small businesses use factoring financing:

• Bank loan turndown or funding denial
• Struggling to meet payroll
• Need to increase staffing
• Customers have extended payment terms such as NET30, NET60, or NET90
• Distressed financial situations – recent bankruptcy, IRS tax liens. Bankers Factoring Lien Solutions.
• Seasonal trends in the business cycle 

How does factoring receivables work?

Factoring financing is an easy process, especially compared to conventional lending or financing. For factoring financing to be an option, your small business needs to have open AR invoices from a commercial customer or government entity.

The first step in factoring financing is submitting our online funding application. We can begin the funding process with a completed application and supporting documents. Invoice factoring provides funding through selling unpaid invoices to a factoring company, like Bankers Factoring.

The steps in the invoice factoring for the small business funding process:

1. Submit an online funding application
2. Upon approval, Bankers Factoring buys your AR invoices in exchange for immediate funding.
3. Bankers Factoring provides same-day funding for up to 93% of the AR value once you are approved.
4. Bankers Factoring rebates the remaining invoice balance less our small fee once the customer (account debtor) pays the invoices.

You can also read how a factoring company works.

What types of small businesses can benefit from factoring financing?

Any small business, even start-up companies, with open invoices from commercial customers or government entities can benefit from factoring. Small companies use factoring financing in most industries to overcome extended payment terms and payroll funding. Extended payment terms are one cause of slow-paying customers. If your business has slow-paying customers or offers extended payment terms, factoring can help your cash flow.

Common industries that use invoice factoring financing:

• Staffing
• Telecommunications
• Oil and Gas
• Medical
• Guard & Security Service
• Construction
• Agriculture (PACA)
• Food and Beverage
• Wine and Spirits

Visit our previous article, “What Industries Use Factoring?”

What qualifications are required for factoring?

Invoice factoring qualification is contingent upon the creditworthiness of your customers or the account debtor. Funding is dependent upon your customer’s ability to repay the open invoices. The approval standards benefit small businesses lacking the credit profile or financials to qualify for traditional financing.

• Business to Business (B2B) or Business to Government (B2G) invoices
• Unencumbered invoices payable – no liens against the A/R
• Accounts receivables (A/R) aging report
• Accounts payable (A/P) aging report
• Tax returns and quarterly form 941 for payroll taxes
• Financial statements (balance sheet, income statement, and cash flow statement)
• Proof of ownership of the business

The factoring financing approval and funding process only takes 3 to 5 days for the cash to hit your bank account. Factoring financing is a quick process compared to the months it takes for traditional loan funding.

Visit our previous article, “8 Requirements for Factoring Financing.”

Invoice Factoring vs. Term Loans 

Factoring funding is a form of non-debt financing for small businesses. When a small company sells its invoices, they receive working capital as compensation. Conversely, term loans are capitalized debt on your balance sheet with monthly principal and interest payments. Term loans are used for significant capital investments such as property, equipment, and other assets. Factoring financing is geared towards short-term funding needs due to the business operating cycle.

We are also one of the freight factoring companies with special start-up programs for trucking and staffing agencies and security service.

Other short-term small business financing forms are available but are less robust than factoring funding. For instance, small businesses run into costly merchant cash advance (MCA) loans which tie up future earnings to repay their MCA provider. A more optimal solution for small businesses is factoring, which provides a flexible cash flow line with no repayments.

The Best Small Business Factoring Company 

Bankers Factoring, one of the Best Small Business Factoring Companies, provides working capital financing throughout the United States, unlike other factoring companies. The Best Small Business Factoring Company takes on the credit risk of removing the burden of bad debt from your customers—this is called non-recourse factoring. Small businesses need fast working capital, so Bankers Factoring provides same-day factoring financing with our best-in-class invoice factoring services and non-recourse invoice financing.

Benefits of partnering with The Best Small Business Factoring Company:

• Up to 93% initial cash advance.
• Same-day funding with personalized customer service.
• Not real estate backed, like bank small business loans.
• Special freight factoring company programs for trucking companies and the trucking industry.
• 3-to-5-day approval and funding process.
• A+ Better Business Bureau rated.
• This is not based on your credit score but on your customer’s credit scores.
• Bankers Factoring provides credit protection against bad debt.
• Access to unlimited working capital.
• Special programs for start-up staffing and IT companies.
• Flexible line of financing that grows as your monthly receivables increase.
• Low factoring fees starting from .9-1.6% per 30 days.

As one of the few award-winning factoring companies of 2023, we hope your small business picks employee-owned Bankers Factoring. And remember, as your small business factoring company Bankers assumes the credit risk.

Ready for the owner-employees of Bankers Factoring to help you grow your company with our award-winning invoice funding services, including bad debt protection? Use our fast online factoring application or call the toll-free number 866-598-4295

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