Who Benefits From Factoring Accounts?
If you are looking for new forms of financing, you might be wondering whether or not factoring your accounts would be a good idea. Factoring is one of the oldest forms of commercial finance for good reason. It is very low-risk for both the borrower and the lender, it makes business possible, and it has predictable costs that allow lenders to calculate their profits with confidence while letting borrowers account for the expense when they quote projects.
Key Industries That Use Factoring
Since factoring works well with practically any business that uses account invoicing, it has gained widespread acceptance in a number of industries, including:
- Construction and home renovation
- Wireless and telecommunications
- Manufacturing and industrial businesses
- Staffing companies and other administrative services
- Healthcare businesses, including emergency responders
If your company regularly waits on customer payment after completing work, there is a good chance that you could benefit from financing your receivables.
Factoring Benefits Your Business
When you finance your accounts, you gain the ability to count on your cash flow working out so you can make you regular outgoing financial commitments without depleting your company’s cash reserves or impacting your ability to get work done. It provides predictable lending costs, and it also means you gain a bit of payment security, because you have help collecting on your accounts.
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