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Accounts Receivable Factoring – What Does That Mean?

Accounts Receivable Factoring is one of the many types of asset financing in which the receivables of a company are used as collateral in a financing deal or arrangement. Receivables are the outstanding dues (money or invoices) that are owned by the customers. The accounts receivable factoring company is also commonly known as an invoice factoring company. In this agreement of the accounts receivable factoring, Carter Funding gives the original company an amount which is equal to a reduced value of the receivables or the unpaid invoices.

Using accounts receivable factoring companies, like Carter Funding, can free up capital that is needed for payroll expenses or company growth. 

Accounts Receivable Factoring 101

Carter Funding offers accounts receivable factoring and provides companies up to 90% of the amount of their outstanding invoices. Carter Funding then collects the debt from the concerned party, and pays the original company the remaining amount due subtracting from it their financing fees.

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Account Receivables Factoring Pricing

There are a number of elements taken into account when Carter Funding is deciding on the amount to offer in exchange of the accounts receivables. In majority of the cases, the account receivables that are owned by big companies have much more worth than the invoices that are owned by individuals or small companies. Generally, an account receivable is of much more value if the factoring company feels that it is easier to collect. The worth will be less if the account receivable is difficult to collect.

Accounts Receivable Factoring – How it Can Help Your Business

If your business is looking for instant cash to keep processes going or for working capital, then accounts receivable factoring can be a good option. Opting for accounts receivable factoring could save you from waiting for a long time to get loan through traditional bank loan processes. Additionally, you will not have to worry about payment schedules if you decide to use account receivable factoring. You will only have to worry about the core aspects of your business instead of thinking about the collecting bills from other parties.

If you are looking for accounts receivable factoring company, contact us today!