Living and working in New York offers many opportunities, which is why it is such a hub of activity for businesses of all sizes. For anyone operating a business in The Big Apple, using financing accounts receivable companies is a very important option for addressing short-term cash flow issues.
Factoring works through the sale, by a business, of their accounts receivables. The buyer, the factor, then assumes the collection on the invoices, charging a small fee. The factor advances the business up to 90% of the total value of the invoices, with any residual provided after the invoice is paid by the customer and the factor’s fees are deducted.
The Speed of Funding
There are several reasons that businesses from small to large turn to financing accounts receivable companies. The most important issue for many businesses is the speed at which the funds are deposited into their account.
With a top company,after a short online application, approval is within 24 hours on business days, with funds deposited within a few days after that. This is much shorter than the weeks businesses will have to wait for a traditional bank loan or a line of credit. Plus, with no interest or principal to repay, the company can more easily and effectively manage cash flow.
The financing accounts receivable company will check on the creditworthiness of your customers, and this process is simple and straightforward. With many types of businesses including those with government staffing contracts, in manufacturing and processing, information technology, or staffing services the entire process is completed in just a few days.
Funding Options
Since the amount of funding available through the financing accounts receivable companies is based on the invoices sold, there is a wide range of funding options. As long as a company has $25,000 in accounts receivable they can receive funds from $25,000 to up to $4,000,000 based on your invoices.
The advantages to the company are easy to see. It is possible to buy materials, hire new staff, make payroll and other financial obligations, while not having any loan or line of credit against the business. Additionally, business owners don’t have to provide a personal guarantee, relieving them of any personal financial risk.
For any business in New York with outstanding invoices, financing accounts receivable is a very good option. Not only will you have funding in days, but it also results in lower overall costs for most companies when compared to a traditional business loan.
