To Small Van Courier providing deliveries in Ireland.
To Small fashion importer and exporter
1. How is invoice discounting and factoring different than a loan from a bank? When making a receivable based funding decision, we will focus on the creditworthiness of your customers while banks will focus on your company’s financial history and cash flow. Invoice discounting or factoring is not a loan, therefore provides you with less debt on your company’s balance sheet. we can make a quick funding decision, while banks may take weeks—even months—to approve a loan.
2. Will my company be eligible for invoice discounting or factoring if it has a bank loan or line of credit? If a bank has a lien on your company’s assets, 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 is plenty of receivables to leverage the buy out.
3. My company owes back taxes. Can I still apply for factoring or invoice discounting? Tax problems are handled on a case-by-case basis. Please let us know immediately so that we can discuss a lien subordination with the tax entity or request a payoff amount. We can use the initial funding to payoff the tax entity if there is enough leverage.
4. If my company is considering bankruptcy, is factoring or invoice discounting still an option? Please contact us prior to filing, there may be some options for you.
5. What information will you need from my company to begin the invoice discounting or factoring program? A short application, your company’s most recent sales ledger, your company documents, a master customer list and a sample invoice.
6. Which customers would be good candidates for accounts receivable funding? Usually 80% of your business comes from 20% of your customers and these would be the most likely to factor, however, we will factor 100% of your customer base so long as they are credit worthy. In order to approve your customer base, we will need their names, addresses, phone numbers and the amounts of credit desired for each client. This will save you time when submitting invoices to us.
7. Can you purchase only a portion of my company’s invoices or one customer? Yes, so long as it is not a one time deal.
8. How long does it take to receive the first funding? The initial funding takes between 3-10 business days after we receive your signed agreement. If you wish, you can send some invoices to be funded with the signed contract in order to expedite your funding. After the initial funding, your company can receive funds within 24 hours after invoice verification.
9. How much of my company’s sales ledger can be funded? We can fund up to 100 percent of your company’s creditworthy accounts and depending on the industry, we may fund up to 92% advance.
10. What should I do if my customer mistakenly sends the payment to my company? The answer to this question will apply to any factor you deal with. This is very common especially with the first initial funding. If this occurs, the check must be sent to us immediately. Your company should never deposit checks that are to be applied to factored invoices. Your customer will be notified to pay us directly in the future.
11. How can I be certain that your 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!
12. What should I tell my customer when they find out I am financing my receivables? Should an account debtor (customer of our client) who is unfamiliar with factoring question the notice of assignment and ask what is going on, the business owner only needs to tell them they have chosen to use a company to manage and finance their accounts receivable.