Accounts Receivable (AR) Financing, also known as Factoring, is essentially the purchase of future income (receivables) at a discount. AR Financing is a prime solution for businesses that want to offer flexibility to their clients without jeopardizing cash flow. Such businesses can “sell” their income to Momentum Business Capital at a slight discount by paying a set portion of that income every month until the loan amount is covered.
We finance all sorts of companies including those who are start-ups, losing money, or in bankruptcy because AR financing is based on your customer’s credit, not yours. This is one of the biggest benefits of AR financing as it is not a debt, but rather the sale of an asset. AR financing essentially enables your business to outsource your accounts receivable department so that you can focus on other things than collecting outstanding invoices from customers.
Momentum Business Capital’s Factoring option gives you other valuable services, such as checking your customers’ credit for you and notifying you of bad risks. We also provide detailed monthly statements and qualifying accounts even get free credit insurance.
Other benefits of AR financing include:
• You get cash in 24 hours
• No personal guarantees
• Financing of any type of business
• No recourse even if the account does not pay
• Credit insurance on your clients at no cost to you
• No arbitrary loan board decisions and no fixed payments
• Funding increases as sales and receivables increase
You can use AR financing for a variety of things in your business, including:
• Fund payroll or other operating expenses for your business
• Purchase inventory
• Fund growth of your business
• Respond to seasonal demands and opportunities for your business
• Take on large accounts with confidence that your business can handle it
Ready to get an AR financing loan for your business?