What is Accounts Receivable Financing?

Whether you are an established business or just getting started, insufficient cash flow can cripple your operations and growth capabilities. Traditional institutions often do not view your company’s Accounts Receivable for what they are, an asset! SouthStar Capital does not see through the eyes of traditional lending institutions and can turn your Accounts Receivable into working capital. This takes away the concern of making payroll, paying vendors/suppliers, and securing growth capital. Your only concern should be producing a product or performing a service, not having to chase clients to meet everyday expenses. Let SouthStar turn your Accounts Receivable into a Line of Credit by using your invoices as collateral.

How does Accounts Receivable Financing work?

Once you generate an invoice, SouthStar goes to work for you. We begin by verifying the submitted invoice(s) and advancing up to 90% of the total value of the invoice(s). SouthStar is concerned with the credit quality of your clients (account debtors) and not your personal or business credit scores. Working capital will arrive in your bank account within 24 hours. Once your client has sent payment for the invoice(s), SouthStar will charge a financing fee and remit the balance back to you. We can repeat this process as often as you can generate an invoice

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Accounts Receivable Financing

The 5 Steps of AR Financing

  1. You provide products or services to another creditworthy business on terms.
  2. You send the invoice to your customer and send the invoice, along with any support documentation (i.e. purchase orders, contracts, etc.), to SouthStar Capital.
  3. SouthStar will verify the invoice then advance a portion of the invoice directly to you, typically 70% to 90%.
  4. Your customer then pays the invoice by ACH, wire transfer, or a check made out to your company, but sent SouthStar Capital’s address.
  5. SouthStar then sends you the invoice balance, less our fee. We can repeat this process as often as you generate an invoice.
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The SouthStar Advantage

  • Same day approval/closing in 2-5 days
  • Working capital is sent within 24 hours of receiving invoice
  • Deal directly with decision makers
  • No maximums for monthly receivables
  • No debt is added to your balance sheet
  • Challenged credit is a non-issue
  • Years in business is not a factor
  • Assigned account team for your company
  • No equity required, keep 100% ownership of your business
  • Save time and money with a third party handling day-to-day accounts receivable

Our Clients’ Testimonials

“My business was literally month-to-month. My business partner and I would sit down with the finances at the end of the month and have a hard discussion about closing the doors. We had over 20 employees counting on us. We just couldn’t solve our reoccurring cash flow crisis. Our customers’ slow pay held our cash flow for ransom, keeping us from completing our next project. The day my SouthStar Account Executive walked through our door was the day our business turned around. Now, we have the cash we need to deliver projects on time.”

– Creative Director for a Graphic Design and Marketing Firm

“SouthStar Capital provides a useful, cost effective service for small businesses who need to maintain cash flow while waiting for customers to process payments through their system. It’s an easy process that comes in handy when the work load is heavy requiring capital but payments for services already rendered are still in receivables. If you find yourself with money owed but low funds in the bank to handle new projects or purchase new materials, give them a call and one of their friendly, professional representatives will guide you through the process. This is not a paid for ad…. I really did write this and mean it.”

– Owner of a Construction Company

“We had the opportunity to bid a huge project that our competitor dropped the ball on. We needed access to cash in order to staff up and prepare to handle this opportunity. I went to my bank, and I was turned down. I went to another bank, and I was turned down again. They didn’t like the fact that we had negative growth in the last year. Nevermind that we had double-digit growth for the previous 8 years! After being turned down by five banks, we accepted the fact that we would have to pass on the project. Then SouthStar Capital met with us and put together a finance strategy for getting us the cash we need. They had all the answers to our questions, and their rates were very reasonable. Long story short, we won the project and are on track for our most profitable year in 9 years!”

– Owner of a Steel Fabrication Plant

“I am a small business owner with limited working capital. My work load increases 200% in the summer. SouthStar makes it possible for me to pay my employees on time without waiting for my net 30 invoices to be paid. They are a life saver. Customer service is exemplary. Any questions or concerns I have had are handled efficiently and expeditiously. I am a satisfied customer!”

– Owner of a Janitorial Cleaning Business

“We approached SouthStar because our accountant highly recommended them, but we expected a turn down as we were behind with the IRS. To our surprise, SouthStar assisted in structuring a payment plan with the IRS and offered us a Receivables Line!”

– Owner of an IT Staffing Company

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What to Expect with Accounts Receivable Financing

When funding your invoices with SouthStar, you will be assigned a personal account manager who will handle collections, payment processing, and customer credit approvals, allowing you to focus on your business. With Accounts Receivable Financing, we look at the credit history of your customer, not your company or personal credit history.

Years in business is not a factor in our decision to finance, making AR Financing great for start-ups. Once established with SouthStar, you will receive same-day funding on submitted invoices. This gives you access to unlimited working capital, right when you need it. Receivables Financing also allows you to extend longer payment terms to clients and grow your business.

Accounts Receivable Financing

Learn more about business growth with Accounts Receivable Financing by walking through the challenges, solution, and results of a SouthStar client success story.

Accounts Receivable Financing

When considering if Accounts Receivable Finance is the right solution for obtaining working capital for your business, ask yourself these 10 questions.

AR Finance Case Study

In this case study, find out how one company went from a cash deficit to nearly doubling their business with AR Financing.