Government Contract Receivables Explained
Getting a government contract can be challenging if you have a small business. Government contract receivables financing can help you while you are waiting for payment from government agencies. Here’s a guide to government contract receivables financing.
When Does the Government Pay Contractors?
The government often pays contractors based on the urgency of the job and the time it takes to complete it. Sometimes a payment can be quick, but depending on the job at hand, it can take up to 30 days. If you are a growing business and require funding for resources, this waiting time can create a potentially crippling financial challenge.
How Will Government Contract Receivables Help Your Business?
There’s little your business can do when it comes to slow payments. The government will eventually pay you, but waiting around for funds does not have to be the only solution. Accounts receivable factoring helps solve your cash flow problems while you wait for the government to pay you.
You simply sell your invoices to a factoring company and they will pay you a portion of the cash that the government owes you. When the government pays you, the factoring company will apply the payment to the outstanding advance plus a small factoring fee for their services.
Advantages of Government Contract Receivables Factoring
- Factors can typically approve and underwrite a factoring facility fast enough to meet small business owners’ timelines.
- Factoring is flexible, You don’t have to commit to a long-term factoring solution if you don’t want to
- You will get the funding you need to keep your business running and to pay staff while you wait for the government to pay you
Who Can Receive Factoring?
Kore Capital offers factoring solutions to creditworthy companies and contractors working with the government. It doesn’t matter if you have a small business or a large company; we will help you obtain the finance you need!
Contact Kore Capital for government contract receivables financing and invoice factoring solutions today!