SERVICES
Our main service consists of purchasing your accounts receivables, once your company has provided a service/product, and properly invoiced your client.
HOW DOES IT WORK?
Your company delivers the products or services to your client
Your company invoices your client
The Invoice is received and validated by an authorized person within your client
Capital Factor will confirm the correct reception by your client
We will buy that corresponding Receivable from your company
We will transfer the corresponding money into your account in less than 24 hours. (Typical advances are between 70-90% of the Invoice amount)
We will collect from your client according to net terms offered
We will transfer you the remaining money, discounting our fees
6 BENEFITS OF FACTORING
Advance term loans, and obtain the money almost immediately at a low cost.
Factoring does not increase the debt of your company
Factoring improves liquidity of your company, which you can re-invest in your business and grow further
Factoring is not a loan, so it does not affect your credit scores and ratios
By having a Factor as a partner, you can offer longer payment terms to your clients, and still have your money available as soon as you Invoice your products or services
We reduce your effort to collect the Invoice, since we will proactively do the collecting efforts of the invoices we buy
Factoring has fewer requirements than a bank
WHEN IS FACTORING MOST USEFUL?
Factoring is an alternative way of financing growth for companies that are B2B or B2G
It is most useful when:
your company is growing very fast and have maxed out your bank credit lines
your company is new and doesn't have enough records for the banks
you want to grow your company but don't want to dilute your Equity and/or use personal funds or credit cards
your company will benefit from having the immediate cash after invoicing your clients
FAQs
Frequently asked questions
What is Invoice Factoring?
Factoring is the selling of your Accounts Receivables in order to get the immediate cash, in exchange for a small fee.
What are the advantages of Invoice Factoring over bank debt?
Since by factoring an account receivable you are selling an asset at a discount fee, Factoring is not considered debt. It does not impact your Financial ratios and/or Credit Scores. By Factoring your Accounts Receivables you can use that cash and re-invest into your company's growth, without diluting your equity, or raising your debt.
What types of companies tend to use Factoring Services?
Factoring tends to be used in the following cases:
1) SME Companies that are growing very fast and may have their credit lines maxed out.
2) Companies that are new and don't have enough credit record for banks, and/or don't whant to have their equity diluted by outside capital.
3) Companies that may get better margins by offering longer net-terms to their clients.
What type of Industries does Capital Factor serve?
We serve a wide range of industries, including Transportation, Staffing, Manufacturing, Industrial Services, Wholesalers.
Where is Capital Factor geographically restricted?
We serve clients in all 50 states in the US.
How is the Fee that Capital Factor charges determined?
We take into consideration many aspects in any particular transaction, like for example the size and payment history of your client, credit risk reports, the payment terms offered to your client (net 30-60-90), the advance defined for the invoice to purchase, etc.