Business Receivable Factoring vs Factoring

Due to the relatively low profile of Business Receivable Factoring it can be referred to by many different names, like Factoring, Credit Factoring, Debt Factoring, Factoring Invoices, and the list goes on. In practice Receivables Factoring is merely another name for Factoring, there is actually no difference at all.

Factoring is a way of unlocking the cash that’s locked up in your sales ledger. But it’s given a number of different names including:

  • Accounts Receivable Factoring.
  • Sales Ledger Factoring.
  • Sales Invoice Factoring.
  • Asset Based Lending.
  • Business Receivable Factoring
  • Factoring

All of these terms mean the same thing. Different lenders will offer slightly different products, but they’ll all be advancing finance based on the value of your outstanding sales invoices.

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Factoring explained

Business  Receivable Factoring, Invoice Factoring or just plain Factoring are the same thing. It’s a process that allows you to release cash from your sales ledger, improve cash flow, and reduce the time spent on credit control.

When you have a Factoring arrangement you send copies of your sales invoices to both your customers and the Factor. You’re paid up to 95% of the invoice value by the Factor –sometimes within 24 hours of submitting the invoice.

The Factor takes the responsibility for raising statements on your customer accounts and chasing them for payment.

When the payment is finally made the Factor passes the outstanding balance on the invoice to you, deducting their service fee.

Benefits of Business Receivable Factoring?

By entering an arrangement for Business Receivable Factoring you’re getting improved cash flow and reducing your administrative overheads. The benefits of doing this include:

  • Access to finance without using business or personal assets as security.
  • More cash means you can pay suppliers on time or even early.
  • You have the possibility of negotiating prompt payment discounts that offset Factoring costs.
  • The amount you borrow is only limited by the amount you invoice.

Do you want a quick and easy indication of how much cash your business could release from its sales ledger through Business Receivable Factoring? Get an online quote now.

Why use Touch?

We understand that your expertise is in running your business and that you want to see it grow. You don’t want to get side-tracked into the detail of finding the best business finance solution – which is why it makes sense to come to an independent broker like Touch Financial.

We’ve helped thousands of businesses to save time and money. We work with over 20 lenders, finding the right Factoring solution for all sorts of organisations.

Our experts understand that every business is different and that there’s no one-size-fits-all Factoring solution. Our role is to match you with the most cost-effective Factoring supplier, based on your industry, turnover and other requirements.

Others benefits of using Touch include:

  • Our service is free of charge – we’re paid commission by the lenders, not you.
  • We respond quickly, often introducing lenders within 24 hours.
  • We can get access to exclusive deals, including ‘try before you commit’ options with some suppliers.
  • We’re the UK’s leading online commercial finance broker.
  • We’re independently owned, meaning we offer impartial advice.

If you need more information and advice, give our experts a call right now. We’ve helped thousands of other businesses – see how we can help you.

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Every month Touch Financial help businesses improve their cash flow with invoice finance. Request a quote to find out how much extra cash you could raise.

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