Accounts Receivable Factoring Home Page
Is the Accounts Receivable Factoring Industry For
You?
The key to knowing if accounts receivable factoring
is for you is to not
to look only at the bottom-line factoring fee, but also
to
consider how your company may increase it's profits through
factoring.
Here is additional
information on factoring
to help you with your decision.
How are accounts receivable factoring fees and advance rates determined?
It is based on several factors:
The
creditworthiness of your clients
Your monthly billing volume
Average
invoice size
Average days to payment
Fees can range from 2-5 % of the
invoice's face value.
For example if the invoice's value is $1,000; a fee of
3% equals $30.
What is an accounts receivable factoring advance?
The
amount of money you receive immediately when we
buy your invoice. The balance
is returned to you when
your customer pays the invoice.
Advances range
from 60-95% of the invoice's face value.
For example if the invoice's value
is $1,000 an advance
rate of 80% equals $800. The balance of $200 less
the
factoring fee is returned to you when your customer pays the
invoice.
Comparing Bank Lending Rates to accounts receivable Factoring?
When
compared to bank lending rates, factoring
initially appears to be very
expensive. Here are five typical
questions/concerns that are raised by potential accounts receivable factoring factoring clients