BusinessCash is funding during the COVID-19 crisis.

We hope the following frequently asked questions and answers (FAQ) will provide you with an understanding of invoice factoring and PO funding, what it is, how it works, and how your company can begin this funding process to enhance your working capital and cash flow. Please contact us in confidence today to see how we can assist you with factoring services.

Questions about Invoice Factoring

What is Invoice Factoring?

Invoice Factoring is the purchase of valid Commercial Accounts Receivable [AR] for cash.

I thought companies only use Invoice Factoring when in trouble

Invoice Factoring gives your business the power to grow, without giving away equity or taking on debt. Contrary to what others say, accounts receivable factoring is NOT only for struggling companies. Financially smart companies use factoring as a powerful tool to release capital tied up in your Accounts Receivables.

How is factoring different from a loan, say from a bank?

Factoring is not a loan; it is the process of purchasing valid Commercial Accounts Receivables [invoices] from your business at a small discount.

Do I have to sign a Personal Guarantee?

Because we give you Working Capital, Credit Protection and include AR Management Services in our fee, the real risk is your performance in meeting your customer’s needs and sadly, the occasional fraud. We ask that you stand behind your work and be honest with us in all our dealings. This is why we ask for Personal Guarantees from your company’s ownership.

Does my business qualify for factoring?

Almost every business can qualify. Our guidelines are very simple: if you have AR, due to a sale in a business to business transaction, you probably qualify. Any size invoice can be funded, provided the service you offer, or the product you sell has been completed and delivered. If you don’t have any accounts receivables, a merchant cash advance might work for your situation.

How will my customers know where to send a payment for invoices that I have chosen to factor?

Your customer will be notified to pay us directly. When invoices are factored they will be stamped with the address to send payment to prior to being mailed to your customer. Your company should never deposit invoice checks that were already purchased by a factor.

Will my company be eligible for accounts receivable funding if it has a bank loan or line of credit?

If a bank has a lien on your company’s accounts receivable, you should let us know right away. We will ask the bank to subordinate that lien. Some banks will accommodate the request and others may decline depending on your circumstances. Our number one referrals come from loan officers willing to help out the client in cash flow needs. They are very familiar with this kind of interim financing. The other alternative is to pay off the loan if there are plenty of receivables to leverage the buyout.

How can I be certain that your factoring company will treat my customers well?

The last thing we want is for you to lose a customer. We are not a collection agency. We will never harass your customers for money. Maintaining your customers’ goodwill and confidence are of utmost importance to us!

Have your Factoring Questions answered? For Funding, call (888) 400-5930 or use the fast, safe & secure online funding application.

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