Funding A Business With Invoice Finance

Invoice finance, or factoring, has become very popular with small businesses recently. Although it has only recently become widespread in New Zealand, it is actually the oldest and most prevalent form of business funding used throughout the world, and Working Capital Solutions are the ‘go to’ invoice finance solution in our country today.

A factoring facility will allow a company a flexible overdraft that will grow with the business and they will be able to borrow up to 80% of the value of their invoices on an ongoing basis, usually while retaining any existing banking facilities that they may have. Companies submit their invoices to Working Capital Solutions for funding, then WCS looks after the collections. The remaining 20% of the invoice value is made available when the debtor pays. A factoring facility allows companies to convert their debtors’ ledger to cash immediately, and then forget about them, allowing the company to focus on growing their business. People will no longer need to beg their customers for precious cash flow before being able to make the next move.

Single invoice finance allows a small business to turn individual invoices into cash at their discretion.  They are not locked into any term contracts and can fund only the invoices they want, when they want.  It’s that simple! Working Capital Solutions pay up to 80% of the invoice value to their client’s account and that single debtor is advised to pay directly to them for that invoice.  The remaining 20% is paid when the debtor pays. Single invoice finance is a great idea for companies with only one or two large customers or intermittent cash requirements and some clients just set up a facility for peace of mind, knowing that they can use it if something unexpected happens.

In some cases Working Capital Solutions can offer undisclosed invoice finance to qualifying customers. With an undisclosed facility they provide a funding line to 80% of the value of the client’s debtor book, without their customers ever knowing they are factoring. On an ongoing basis their overall balances are submitted to Working Capital Solutions to make funding available, but the client is still responsible for the collections and their customers are not aware of the relationship. This is a very versatile product generally reserved for high turnover clients with a strong trading history.

Invoice finance, in all its guises, converts small businesses to cash businesses and provides the precious cash flow a business needs for growth, funding it into the future. For further information, please visit the website at http://www.workingcapital.co.nz .