A Guide to Financing Invoices with Accounts Receivable Factoring

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Is your business struggling to keep up with daily expenses or having trouble meeting your payroll demands at the end of the month? Perhaps you’re just getting sick of tracking down late invoices or experience a fluctuating cash flow. Either way, having an accounts receivable factoring company like Camel Financial at your disposal can be extremely beneficial.

If you’re not familiar with how financing invoices works, don’t worry, we break down all of the aspects for you here, so read on

How Does Factoring Invoices Work

The invoice factoring process is relatively simple. The process begins after you’ve billed a client for your goods or services. Once this is done, you send that information (usually just a copy of the invoice) to your invoice factoring company. After doing so, the factoring company will then provide you with cash-in-hand for the amount of your invoice (typically between 70-90% of the overall amount). Once the invoice is paid, you’ll then receive that remaining/outstanding percentage.

Common Uses for Accounts Receivable Factoring

Some of the most common reasons why companies turn to accounts receivable factoring are: to provide the funds needed for growth when new business opportunities arise, resolve any cashflow problems that might occur on a daily basis, maintain a back inventory of products or materials to deal with future growth, and get the money a company needs without resorting to predatory lenders or taking on large amounts of debt.

What Are Some of the Foremost Benefits of Accounts Receivable Factoring?

Some of the primary benefits of working with an accounts receivable factoring company include:

  • Helping your business survive a downturn (or pandemic).
  • Helping you build good credit for your business.
  • Pursuing new opportunities in your industry for growth while remaining financially solvent.

The Cost of Financing Invoices

As mentioned above, the percentage you’ll be able to receive from each invoice will depend upon the rate your invoice factoring company offers you. Other things that will affect the cost will include the length of service, as well as any additional fees you incur from your factoring company.

Let us be your accounts receivable factoring company!

If you’re in need of equity or want to build up your cash reserves, Camel Financial can help. Contact us online today or call (949) 722-7717.

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