Contract Credit, Inc provides fast and simple solutions to understand invoice factoring services for all industries.
Cash flow can be a major challenge for small and mid-sized businesses, especially when the company doesn't get paid immediately after delivering their product or service. Accounts receivable factoring is a common type of commercial financing that helps your business access capital right away when you sell on credit terms. If you're looking into loan options, you should understand what invoice receivable financing is, how it works, and what the advantages are.
Accounts receivable is the amount owed to a business by customers who have not yet paid. Many businesses bill customers by invoicing for services or delivering goods on Net 30, 60 or 90 Days. There can be a gap of weeks or months between the time the product or service is provided and when the customer pays. Accounts receivable is listed on a company's balance sheet as an asset and can be pledged for financing.
Receivable financing provides capital to a company based on the company's accounts receivable balance. This allows companies to get immediate access to the cash they were due to receive from customers in the future.