What is a Factoring Company?
A factoring company which is also called an accounts receivable financing company or invoice factoring company is a company that provides a financing option to businesses referred to as factoring accounts receivable financing or invoice factoring.
Factoring companies are an excellent alternative to banks and can work with companies of all sizes and in all stages of business, from start-ups to well-established companies.
How do accounts receivable financing companies help businesses?
Invoice factoring companies purchase unpaid accounts receivables. This improves a company’s cash flow by allowing them to get paid quickly, eliminating the often 30 to 60+ days wait for payment. The factoring company will charge a small fee, generally from .5% – 1.5%.
In addition to getting you paid quickly, an accounts receivable financing company often provides additional services for little to no additional cost, notably they will perform credit checks on your customers to ensure they are creditworthy. Additionally, they will focus on the collections of your receivables, leaving you to focus on growing your business.
Give Franklin Capital a call today at (847) 579-4780 to see if they are the right invoice factoring company for your business.