Business Debt Factoring Service

Thinking of Factoring? Is It Right For Your Business?

Business Debt Factoring can be a great way for some companies to raise finance and shift borrowing off their balance sheet. It is an alternative, but similar, to invoice discounting. It has its pros and cons. If you are closing one business and maybe looking to pre-pack the solution into a liquidation or an administration, then we will be able to finance your wishes.

Advantages of Factoring:

Business Debt Factoring is among the quickest way to get advance cash. Overhead charges get automatically reduced with the cut in invoice processing activities.
Getting cash with factoring helps in eliminating the risks of bad debts as these can be insured against.
The business owner becomes free of various other obligations connected with the invoice processing like depositing cheques and entering payments.
The task of debt collection is undertaken by the factoring company and so it helps the company by releasing time for it to concentrate on value added activities.
It gives an opportunity to offer credit terms to customers without hindering cash flow.
Debt Factoring brings no extra liability in the balance sheet and hence does not result in creating hassles while obtaining other types of financing.
Early payment discount is another benefit of factoring. Payment of bills before the scheduled time brings in many benefits in the form of discounts.
It is an easy way to have an access to unlimited capital as, with an increase in sales, more money becomes immediately available to business owners.
Some other benefits include building credit, quick and easy processing, concentration on marketing and securing new accounts and no long-term obligation.

Disadvantages of Factoring:

The biggest disadvantage of business debt factoring is that it makes the process complicated as it acts as an extra link in the process. However, we have good links with a number of companies and can advise at the outset on this matter.
It is useful for companies with disputes and queries to hold up payment which may result in clawbacks.
The ambit for borrowing gets narrowed, as account receivables will not be available for security. Many banks often require this to be available for them to add onto other borrowing.
Factors may want to get your customers examined and may have influence over your ways of doing business. This is usually the case where there are few customers of high value.
In case the customers do not repay the money, you have to pay their amount entwined in factoring. It can lead to the inability to draw down full amounts each month.
It is costlier than other sources of finance though it is competitively priced.
Few customers want to deal with a third party and therefore are not interested in factoring.

If you would like to talk about business debt factoring to a specialist with 17 years corporate insolvency experience then enter your details into the web form below for a no-obligation chat.

However, if you need help with personal debt (rather than business related debt) go to our free debt management plan application form.

Can't move or sell your house because of negative equity? We may have the solution at Sell My Negative Equity House, our sister site.

See the video Small Business Factoring Service.

We specialise in the following:

business debt factoring
invoice discounting
business bankruptcy
business finance
company bankruptcy
voluntary arrangement

pre pack administration

voluntary liquidation
business liquidation
wrongful trading
business insolvency
business rescue
business turnaround

pre pack liquidation

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