How Factoring Protects Your Business From Bank Collapse

How Factoring Protects Your Business From Bank Collapse

How Factoring Protects Your Business From Bank Collapse

Factoring can protect your business from bank collapse. Not only are banks less likely than they have ever been to extend credit to small enterprises, but the current state of the financial system makes obtaining credit from a bank more difficult. Depending on your circumstances factoring may be a more viable solution.

Why Factoring Is A Better Option In These Difficult Times

Applying for a business loan can be challenging for small entrepreneurial enterprises at the best of times. A small business is less likely to be approved for a bank loan. This is especially true in our current economy. Given the banking industry’s current crisis, banks are less likely to extend credit to customers. Small business owners may want to consider factoring for their financing needs.

With factoring, you do not need to worry about capital requirements or your credit record. All the factoring company needs from you are your accounts receivable. You effectively sell your invoices to the factoring company, which then advances the cash to you and collects the receivable sums directly from your customers. You steer clear of the banking system entirely and do not have to incur any debt. 

When you submit an application, include:

  • detailed accounts receivable
  • accounts payable aging reports, and
  • samples of the invoices you wish to factor.

Your credit history is less important than your client’s credit history. Our diligence focuses on the credit history of your customers to determine how reliable they are as payers since we will be collecting directly from them. We will pay you a certain percentage of the total of the invoices factored within a matter of days. You can then get on with your business and wait for the remainder to be paid to you (after we have deducted our fee).

Kore Capital is an experienced and trusted financial services provider that can offer you all the benefits of factoring services and other alternative funding methods. Contact us for more information.

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