Accounts Receivable Financing
This is a form of secured lending giving businesses short-term financing by selling their trade receivables
or pledging receivables as collateral for a loan. With an accounts receivable loan the borrower draws against a
line of credit that is less than the full dollar value of his trade credits. Accounts receivable financing is a
rather flexible way of obtaining credit, since borrowers' financing costs are directly related to their
business cycle.
What industries qualify for Accounts Receivable Financing?
A business can qualify for accounts receivable financing if it generates sales on open credit terms to credit
worthy businesses. Most businesses are fast growing companies whose past earnings and sales histories will not
justify a traditional loan. A/R financing programs can accommodate start-up operations with no financial base
to rely upon or companies with seasonal or uneven sales patterns.
When is cash available?
Once your account is opened immediate cash is available for invoices.
What type of Accounts Receivable Financing is available?
Recourse and non-recourse is available.
What are the benefits of Accounts Recievable Financing?
As a business owner financing your capital needs can be difficult in times when bank loans and credit
is limited. In most cases companies turn to A/R Financing because their majority of capital is tied up in
inventory. Accounts Receivable funding allows the company to free up capital.
How big are the advances on receivables?
The advance amount assigned to the account depends on the age of a receivable. Advances can be as high as
90%. Any accounts receivable over 90 days typically are not financed.
Contact Us for a free consultation.