IMM Accounts Receivable Factoring – A Flexible Line of Credit that Grows along with Your Sales
How many times have you looked at your Accounts Receivable Ledger and saw how much money you are owed to you by your customers for work you have already done and thought “if only I had that money in my bank account right now I could take on that new customer or buy that inventory we need?” Consider Accounts Receivable Factoring.
AR Factoring or AR Financing can free up the cash that you have locked up in your Accounts Receivables. Many people call this a Factoring Loan as well, but in reality, it is not really a Business Loan, it is an advance on cash that you are already owed by your customers, you just have not received it yet.
Accounts Receivable Factoring in reality is nothing more than a line of credit using your delivered and confirmed orders where your customers pay on terms of 90 day or less. That is really as complicated as it is. As your sales increase, so does your Line of Credit availability. With this Program, the most important thing is that the customers you sell to must be creditworthy. You will be able to get an advance on all delivered products when you raise an invoice, assuming your customers are creditworthy. Only Commercial Sales are eligible under this Program.
IMMFinancial.com will generally set the advance rate at 85% or more against the amount of money that Your Customers owe you.
And when your customers pay their invoices that they owe, this will pay back the advance you received.
This means there is no fixed monthly payment you need to be concerned with.
The amount advanced to you will grow with your sales so as your sales increase, so will your line of credit.
At the end of the day, the money that you draw down from the Factoring based line of credit is money you were going to receive when your customers paid their invoices.
So, how does the process actually work?
That is a great question and I would be happy to give you a high-level perspective of the actual process.
Once a Factoring Line has been established, IMMFinancial.com will advance you on all current outstanding approved invoices and also advance on any future invoices that have been issued to approved customers.
AR Factoring Process:
1. You issue an invoice to your customer.
2. You provide the invoice and proof of delivery/customer acceptance of the invoice.
3. IMMFinancial.com may confirm the documents submitted.
4. You will receive and advance deposited to your bank account.
5. Your customer will pay the invoice as per the terms of sale.
6. IMMFinancial.com will deduct the amount advanced to your for that invoice and deposit the difference less the finance fee within 24 hours.
Invoice Factoring Questions and Answers
- What does IMM Financial, a top performing Factoring Company, offer?
- Exactly what are the mechanics of Invoice Factoring?
- What are the Benefits to me and my company to use the services of an Invoice Factoring Company?
- Which industries or company types are best served by an Accounts Receivable Factoring Company?
- Who are the clients that use Invoice Factoring?
- Are the applications requirements as involved as getting a bank loan? What is involved in the application process?
- Which types of transactions are not eligible for funding through Accounts Receivable Financing?
- I have customers in different countries; will your Invoice Discounting Program work with these Invoices too?
- What is the time line to get arrange funding my Company using Invoice Factoring?
- What is the main reason that my Company should consider financing my Accounts Receivables and consider working with Factoring Companies?
1. What does IMM Financial, a top performing Factoring Company, offer?
IMM Financial is an International Factoring Company that offers Professional Invoice Factoring Services, known as Accounts Receivable Factoring. Invoice Factoring, or Accounts Receivable Financing, is the leveraging of Invoices, or Accounts Receivables.
A small discount is charged for this service whereby the company offering their Receivables for Factoring receives an immediate Cash Advance against the Invoices. IMM Financial offers several financial options as well as Factoring Services to our clients. Our services range from Accounts Receivable Factoring, Accounts Receivable Management, Purchase Order Financing, Debtor-In-Possession Financing, Government Receivables Funding, International Trade Financing, Merchant Card Advances, Equipment Leasing, Documentary Letters of Credit and more. With many years of history as a driving force among Factoring Companies, IMM Financial is a partner with our clients and their success is our success. Through our experience we have attained many insights into market trends and activities as a Principal Invoice Factoring Company.
2. Exactly what are the details on the mechanics of Invoice Factoring, generally referred to as Accounts Receivable Factoring or a Factoring Loan actually work?
Invoice Factoring, or Accounts Receivable Funding, will permit your Invoices to be converted into cash. We advance you from 80% up to 97% of the Invoice face value. Any reserves are forwarded to you once the invoice has been paid by your customer. In using our Invoice Factoring Services we provide you accelerated Cash Flow. By increasing your Working Capital you will have the ability to pay your suppliers when needed or even make use of discounts they may offer. You will be able to meet the payroll commitments and grow your business.
3. What are the Benefits to me and my company to use the services of an Invoice Factoring Company?
The Benefits are Improved Cash Flow. You will be able to concentrate on running your business as opposed to chasing after payments from your customers. You will be able to purchase the inventory you need, have less stressful payrolls and take advantage of suppler discounts.
4. Which industries or company types are best served by an Accounts Receivable Factoring Company?
We service nearly all industries however companies that benefit from our services the most generally have the following in common:
- Are rapidly growing and have reached the limit of their Operating Line of Credit at their bank and are in need of additional Working Capital. Accounts Receivable Factoring can meet the needs of these rapidly expanding companies.
- Are not eligible for bank funding due to the fact that the company is young or perhaps it is even a because they are a startup company. Invoice Factoring Companies are not concerned with the client company’s balance sheet, they are concerned with the creditworthiness of the customers of the company looking for funding
- Are in workout position with their bank and are in need of options. Invoice Factoring can be a viable solution to this circumstance.
- Are interesting in doing a leveraged buyout either for their own business company or in the acquisition of another business.
- Are seeking a temporary bridge funding solution while they pursue bank financing.
- Have previously used bankruptcy protection in the past or perhaps are in the final stages of considering doing so. AR Factoring, or a Factoring Loan can provide a quick financial option to start to repay creditors and perhaps avoid the bankruptcy all together.
5. Who are the clients that use Invoice Factoring?
We provide Discount Factoring Services to many industries such as:
- Trucking Companies
- Temporary Staffing and Recruitment Agencies
- Distributors (electronics, food and beverages, sundries, etc.)
- Importers (clothing, home furnishings, dry goods etc.)
- Printing Companies
- Building Maintenance / Window Cleaning Services
- Armed Security Agencies
- Software Developers
- Advertising Agencies
- Media Companies
- Information Technology Staffing
- Various Consulting Firms
6. Are the applications requirements as involved as getting a bank loan? What is involved in the application process?
No, the process is not nearly as intrusive as a bank application. The main condition is that our clients must sell their products or services to creditworthy customers with terms of sale under 90 days.
7. Which types of transactions are not eligible for funding through Accounts Receivable Financing?
We cannot service Accounts Receivable Financing to:
- Businesses that conduct consignment sales
- Businesses that have extended payment terms
- Pre-billing or progress billing arrangements
- Construction Factoring deals where the General Contractor will have a first lien
8. I have customers in different countries; will your Invoice Discounting Program work with these Invoices too?
Absolutely, we are able to accept invoices from many countries worldwide.
9. What is the time line to get arrange funding my Company using Invoice Factoring?
Generally speaking with a full application, the typical turnaround time from the first discussion about AR Factoring with a Factoring Account Executive representative until your receive the initial funding with Invoice Factoring is around 5 business days.
10. What is the main reason that my Company should consider financing my Accounts Receivables and consider working with Factoring Companies?
- Take advantage of volume discounts and early payment discounts by using the Liquidity you now have from using Invoice Factoring
- Building up your inventory using the freed up Working Capital your received from Discount Factoring
- You will reduce your bad debt and thereby improving your own credit rating
- When you outsourcing your Accounts Receivable Management you will enjoy benefits such as free credit checking and a dedicated collections department when needed
- You can use your new found Working Capital to increasing your marketing programs
- You will be able to manage any seasonal fluctuations your industry experiences much smoother
- Now you will have the ability to secure big orders using your new Working Capital Funds
- Increased sales can be generated by offering credit terms to your clients
- Prevent your fixed assets from being encumbered
- There will be less debts showing on your Balance Sheet because Invoice Factoring is not considered a Loan which will also allow you to retain your equity and ownership position
- As your sales increase, any increased sales demands will not drain your Credit Line as it would with a traditional bank loan as your Factoring Line of Credit grows with your sales