Want to Learn More About Factoring, Here Are Some Great Resources

by VENDIREX on 02/26/2015 - 10:35 am |

Tag: Business Loans


The best place to start is with the basics [4]. Vedirex has put together a great article that covers the foundation of factoring loans.

“To work with a factor, you start by handing over copies of the accounts receivable that you want funded. Depending on your business and the terms of your agreement, the factor will advance you 70% to 90% of the total invoice value, usually by directly wiring it to your bank account. You can usually get an advance against your invoices within two to five days. If the factor accepts electronic invoices, you may get funded within 24 hours.”

If you have never looked into factoring, we recommend starting with an introduction to factoring [3]. We have answers to common questions in this guide.

“Factoring transfers ownership of your accounts receivable to a factoring company, sometimes referred to as simply "the factor." The factor advances you most of the money owed on the invoices you provide to them. They then pay the remainder – minus a factoring fee – after your clients pays their invoices. You can use the funds to make payroll, invest in materials for an ongoing project, or satisfy high‐interest debts.”

If your business bills clients (invoices customers) then you can use those invoices for factoring finance. It’s fairly simple process. Basically, you sell your accounts receivables to a factoring company.  

It is a great way to get financing and many companies rely on it for cash flow. One of the first questions that people ask is who is eligible to get a factoring loan [1]. You can get more information on who uses factoring here.


“Factoring is also a valuable resource for businesses like garment companies and textile businesses that traditionally have a hard time securing loans. By factoring their accounts receivable, they can purchase raw materials or make other investments grow their businesses.”

The next question that business owners and CEO’s ask is usually what types of factoring are there [2]. Make sure you take a few moments and review this article.

“Non‐recourse factoring frees your company of any responsibility for non‐paying accounts. This is the more expensive option because the factor takes on more work and more risk. The factoring provider in a non‐recourse situation will typically have more stringent policies for the invoices they will accept” 

Many businesses have an opportunity leveraging their accounts receivables. If you think that this type of loan may benefit you, talk to a factoring company today by going here







Leave your comment

You need to login to leave your comment.