Use AR Funding or Factoring for Same Day Working Capital.
Table of contents
- Use AR Funding or Factoring for Same Day Working Capital.
- Don’t Wait 30-90 Days for Invoices to Pay.
- Sell us your accounts and receive the following:
- What is A/R Funding?
- Is AR Funding Right for My Business?
- How does A/R factor financing work?
- How are A/R factoring agreements structured?
- What are the pros and cons of receivable financing?
- Bankers Factoring A/R Funding through Non-Recourse Factoring
Don’t Wait 30-90 Days for Invoices to Pay.
Banks turn you down for a line of credit? In a cash flow crunch? Lack of working capital killing your growth? Does this sound familiar? Business owners need access to working capital. AR Funding fixes cash flow issues by turning accounts receivable in the same day working capital.
AR funding, also known as invoice factoring or accounts receivable factoring, turns 30 to 90-day-old invoices into same-day working capital. Bankers Factoring provides accounts receivable (A/R) funding to businesses in all industries with unpaid receivables. We provide money in your business bank account on the same day you send invoices to your customers.
You can also read our guide to accounts receivable funding.
Sell us your accounts and receive the following:
- Up to 93% cash advance of your total A/R value
- Receive same-day funding once your account is setup
- Receive credit protection if your customer skip on their payments.
- Access to no limited working capital – as your business grows, so does your factoring line
- Poor credit qualifies – we look at your customer’s credit history
If your business can benefit from our fast and easy funding process, submit an online funding application to begin the A/R funding process through factoring.
What is A/R Funding?
When you want to sell your accounts receivable, you can use an A/R funding source. A/R factoring is a type of financing that allows you to sell your receivables to a third party, Bankers Factoring, the best non-recourse factoring company. Once you sell your open A/R invoices to us, we pay you and collect payments from your customers.
A/R funding helps improve cash flow by allowing businesses to receive immediate cash rather than waiting until their customers pay them in full. It also frees up working capital by giving companies the right to remove long days of sales outstanding (DSO). Your business receives an easy financing process without complicated payment structures like with banks or other lenders.
Related article: What is Receivable Factoring?
Is AR Funding Right for My Business?
A/R funding has many benefits through factoring unpaid receivables. Businesses need help to obtain working capital financing depending on A/R financing. Receivable factoring accelerates cash flow that removes payroll and payable constraints.
Business owners need trusted funding sources without taking on debt or giving up equity when they cannot secure bank loans or lines of credit.
Other forms of A/R funding, like A/R loans or financing, require different qualifying standards and come with balance sheet debt.
Here are some questions to ask an A/R or Accounts Receivable Funding Company before getting started with A/R factoring funding:
- What are the costs associated with this type of financing?
- Do you need help paying bills or employees on time?
- Have you tried to obtain bank financing and failed?
- Is your business a startup that needs more financial history?
- Do you extend credit payment terms to your customers?
- Do you have a seasonal business?
- Are you looking to increase staffing but need more regular cash flow?
If you answered yes, to any question above, A/R factoring could be a quick option to resolve short-term cash flow crises.
Bankers Factoring works with all businesses to receive the funding they need. Business owners needing more credit can obtain access to useful working capital by selling unpaid invoices.
Related article: Why Sell Your Accounts Receivable?
How does A/R factor financing work?
A/R funding through accounts receivable factoring is an optimal way to sell your unpaid invoices to Bankers Factoring (Third party). The factoring process starts with unpaid invoices for commercial customers or government contracts. Without unpaid invoices from creditworthy customers, there is no A/R funding through factoring.
When you decide to sell your receivables to Bankers Factoring, we provide cash funding directly into your checking account. By selling your receivables, your business is no longer responsible for getting payment and guiding the receivable process.
Unlike bank loans or lines of credit, we always provide bad debt protection through our non-recourse factoring program. You are not responsible for bad debt damages caused by customer bankruptcy, insolvency, or protracted short pay once we buy your invoices.
The easy and fast A/R or accounts receivable factoring process steps:
- You need cash flow and have unpaid invoices from your creditworthy customers
- Submit an online funding application with your invoices to Bankers Factoring
- Bankers Factoring approves your funding request within 3 to 5 days
- Setup your account and receive 80 to 93% cash advance of your A/R value the same day (Same Day A/R Factoring)
- Once your customer pays in full, we pay you the remaining funds, less our low factoring rate
Related article: What does Factoring Your Invoices Mean?
How are A/R factoring agreements structured?
This type of financing is a good option for companies with a steady stream of customers with a history of paying on time. Bankers Factoring offers non-recourse factoring agreements that provide regular cash flow funding and credit protection (bad debt protection). Our A/R funding program provides 24/7 online access to your factoring account.
The most important part of structuring factoring agreements is creditworthy customers. Factoring deals depends on your customer’s ability to pay – client base quality is everything.
Bankers Factoring advances your company’s cash based on future customer payments. Therefore, we buy your accounts receivable through an asset sale. With this, you no longer have to manage the receivable process through your finance department.
The factoring agreement includes the most critical terms and conditions of your funding agreement:
- Factoring line: the cash funding you can access monthly – this is regularly looked into and increased with experience.
- Advance rate: how much we advance you per invoice
- Discount rate (Factoring rate): the factoring fee we charge for giving your cash flow financing
- Reserve rate: the amount of invoice value held back from your cash advance
- Receivable eligibility: the terms to submit your invoices for A/R funding
- Conditions: specific conditions for payment processing and additional terms
Why is receivable financing necessary for businesses?
Receivables financing is an excellent option for small businesses that need help in managing their cash flow. Factoring funds can also pay down debt, hire new staff, and expand your business.
- A/R factoring provides funding for businesses that unable to secure financing
- Most customers require longer payment terms, and factoring provides financial backing.
- Businesses in cash flow crisis need access to payroll funding
- Free cash flow from A/R financing can be used to grow sales, hire marketing firms, and expand into new markets
Related article: Why do Companies Use A/R Factoring?
What are the pros and cons of receivable financing?
Let us look at the benefits of A/R funding by factoring invoices:
- You do not have to rely on your credit for approval- Your good accounts receivables is what matters.
- You can use the capital immediately.
- Improve staff morale by paying employees on time and investing in organizational development.
- Reduced risk through non-recourse factoring, which provides credit protection.
- Access to no limit working capital: as your A/R increases, we can increase your factoring line.
- No long-term repayment plan like with a term loans.
- A Total A/R Management Solution.
The drawbacks to A/R funding are limited. As can be seen, the main disadvantage of A/R factoring is that the long-term cost can be more than traditional loans or lines of credit. In the short and medium term, factoring is a cost-efficient vehicle for your funding.
Related Article: The Pros and Cons of Factoring A/R
Bankers Factoring A/R Funding through Non-Recourse Factoring
Unbankable businesses, startups, and underserved industries need access to reliable working capital. Bankers Factoring provides regular cash flow funding for companies with unpaid receivables. Our team of funding experts works to develop the best cash flow management plan that aligns with your customers and A/R. via our invoice factoring service.
From Hawaii to South Carolina, we provide same day working capital plus bad debt protection, protecting you from a large customer going out of business using your clients solid accounts receivable.