Factoring is also known commonly as “accounts receivable financing.
Factoring is a financial transaction whereby a company sells their accounts receivable to a third-party, also known as a factor. This is done so that invoices with longer payment terms, usually 30 to 90 days, can be turned into cash more quickly.
A factoring company specializes in accounts receivable financing.
A company that specializes in purchasing accounts receivable at a discount and provides funding to the customer for the receivables purchased.Here is an example of an invoice that was factored:
Companies face restricted cash flow from slow paying customers.
The biggest challenge that companies face is slow payment from customers. Some customers dont pay on their invoices for 30-90 days. As all businesses have monthly cash flow needs, you can see why the numbers oftentimes dont work. What businesses need is a financing program that provides the cash needed to meet the immediate financial demands of their business, like payroll or fuel. That is where factoring, also known as accounts receivable financing, comes in. Accounts receivable financing also provides the cash flow to:
No!
Factoring is the purchase of a company’s accounts receivable in exchange for funding, as opposed to a bank loan using those receivables as collateral.
In some situations, but not most.
Bank credit lines may be adequate in some cases, but not always. Credit problems often prevent businesses and individuals from qualifying for bank loans. With factoring, the decision to provide you with money is based on the credit worthiness of the customers you have. Banks typically have a set of inflexible criteria such as:
It comes down to the quality of the invoices.
Like other factoring companies in the industry, we look at several things: the average dollar amount of your invoices, the number of invoices that you will factor each month and the average number of days your debtors take to pay on the invoices.
Yes!
At Integrity Factoring you are not required to send us originals unless your customer requires it. As more business transactions become digital it is becoming very rare for someone to send in originals; most invoicing is now being sent in via fax or email.
We have multiple payment options.
We can same day wire, ACH, Direct Deposit, or mail the money to you.
24/7 online account access is available to all customers.
Just click on the client login on our home page and access our online system. There you may enter schedules, track payments, run aging reports and manage every aspect of your account 24/7.
Yes.
Integrity Factoring is like all other factoring companies and a first position is required as collateral on all accounts receivable that are factored, and a UCC financing statement will be filed to evidence it.
The invoices are stamped with a remit to address for payment and a Notice of Assignment letter is sent.
No.
You can select the accounts to factor and are able to maintain others in-house by direct billing. With the accounts you select to factor you can choose to take an advance on some invoices and not on others. Unlike other factoring companies, with Integrity Factoring you will not be charged a per invoice charge on invoices upon which you do not take a factoring advance.
No Problem.
You can stop factoring at any time without penalty. You are not committed to use our service for any length of time. However, we cannot issue a release until all open accounts receivable for your company have been paid in full, or your account is purchased by another factoring company.
Yes.
Like most other factoring companies we do hold a small cash reserve, usually a percentage of your credit limit.
Simply swap your invoices.
If an invoice remains unpaid after a previously agreed upon term, you would simply exchange the invoice for another of comparable value.
