How can invoice financing help your company? While all invoice finance options help to free up extra cash flow, there are a variety of ways that you can use this financing method to benefit your business.
Short term bail out
Sometimes, you might be left short at the end of the month due to a customer’s failure to settle their accounts, especially when they’ve made up a large part of your revenue for the month. You need to pay wages and bills, but don’t have the money to do so. Invoice finance can release money from unpaid invoices giving you the funds within 24hours, letting you keep your staff and creditors happy.
Long term assistance
Invoice finance is another option for regular help through a structured factoring plan. This is especially true if your business is finding it difficult to access bank loans – indeed, requirements are becoming all the more stringent in light of ongoing financial distress.
With factoring, the lending company takes over debt collection. For small companies lacking a dedicated finance department, this can save time as chasing payment can eat up hours and days each month.
Growth and development
Expanding your business needs cash to be flowing freely. Invoice finance gives you an extra injection of cash that means you’ll have breathing space to start thinking about growing your business. With these extra funds you can expand and help to generate new revenue streams.
If you forsee that you’ll be having a tough month, you can pre-empt this by turning to invoie finance. This can act as a financial safety net, stopping you from falling behind on your own debts. As well as being a positive way to look for growth, invoice factoring can also be useful when the worst is looking likely.
Invoice finance has a number of applications – whatever your financial needs, it’s definitely a finance option worth investigating.