How to Fund Your Growth Through Invoice Financing?
- August 31, 2020
- Written by : REIL Capital
Businesses can face cash flow problems — and that’s not fun. There are times when client payments are delayed, leaving cash flow gaps in monthly revenue. In fact, 43% of businesses apply for financing in the first 12 months of operation to fill these types of cash flow gaps. Luckily, there are several funding options available from both banking and non-banking financial institutions for small businesses. Invoice financing can be a great way to keep business operations running when client payments are delayed. It can also be a real alternative to business loans because it can be used in conjunction with other types of funding.
Many US businesses have been making invoice financing their first choice to raise funds for business growth. It is a cheaper and faster way to overcome cash flow problems rather than bank overdrafts, equity finance, and business loans. Below we will stroll through some useful ways small businesses can fund their growth through invoice financing.
How Invoice Finance Can Fund Your Business?
The invoice finance works in the following ways:
You will receive a percentage for example 85 percent against new sales invoices, raised over credit terms while raising them.
A balance is paid as the charge for using the service when the customer pays the debt.
In case, if you are raising multiple invoices, you would receive an advance against all of those invoices (subjected to eligibility criteria). So, the amount of money financed can grow in line with the growing turnover of the business.
You can also avail benefit from the invoice finance company as they can help you with your credit control.
This could also provide you with a working capital injection that might be used to fund businesses day-to-day.
Additionally, if you are worried that sales might get sporadic then choose a selective facility. It comes with no minimums, where you can pick as well as choose the type of invoices to get funded.
Why Invoice Finance Is Best for Small Businesses?
No Further Debt
Small businesses can get the required working capital without taking any debt. The only security to raise funds through invoice finance is the debtor book itself.
You can know the exact receiving time for your payments. This helps it in making plans easier for future work and take advantage of opportunities when they arise.
It Frees up Time
The finance provider would check the credit prospects as well as chase all the outstanding invoices on your behalf. As a result, it would provide you more time for concentrating on the growth of your business.
Avail Quick Business Funding From REIL Capital
We are experts in providing small business funding and we know the importance of small businesses. We can help you to generate funds for the growth of your business through the pending invoices. You can avail of a variety of loans from our company as we excel in offering services all over the US.