Category Archives: Invoice Financing

The Cost of Invoice Financing

Feb 04, 2019 Posted in AR Financing, Invoice Financing, Small Business

Cost of Invoice Financing
Cost of Invoice Financing

Have you ever considered invoice financing, but thought the cost would be prohibitive? Well, maybe the question should be what is the cost of not financing your invoices? If you’re turning down a large job or contract because you don’t have enough working capital, think about the associated revenue your business is missing out on. Consider not just the lost opportunity cost, but also the growth opportunities your business is missing due to a lack of cash flow.

With invoice financing, we advance up to 90% of your outstanding invoices, so you get the capital you need right when you need it. Our funding decision is based on the credit quality of your clients that owe on the invoice, not your credit score. Once the invoice is paid, we remit the balance back to you, minus our fee. There’s no lump sum loan amount to repay or minimum monthly payments to make. Invoice financing simply gets you your money faster, providing you payment within 24 hours of submitting your invoice for your delivered product or service.

SouthStar is more than just a source of steady capital. You can also think of us as your accounts payable and accounts receivable departments. We’ll handle your billing and keep up with which customers have paid and which are outstanding. This is at no additional cost and saves you from hiring office staff to do the job. We also provide credit checks on your new clients to ensure the credit-worthiness of your new prospects.

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5 Reasons to use Invoice Financing to Grow your Business

Jun 28, 2018 Posted in AR Financing, Invoice Financing, Small Business

Grow Your Business with Invoice Financing

The 5 reasons to grow your business with Invoice Financing.

Grow Your Business with Invoice Financing

①
Easier Qualification

Qualifying for a bank loan can be strenuous and time consuming, especially if you have a challenged credit history. Invoice Financing is different, in that the qualification process is based on your customers’ credit, not your own.

②
Get Paid Faster

Why should you have to wait 30, 60, or even 90 days to get paid by your customers? Invoice Financing allows you to unlock the cash within your business immediately, making growing your business easier.

③
Add Flexibility

Invoice Financing is a means of accelerating payments you’ve already earned. You can choose to finance invoices as you please, and there’s no restrictions on the amount of invoices you submit. You can also use your financing as you see fit, whether it be to order new materials, purchase new equipment, or meet payroll.

④
More Affordable

Compared to alternatives, such as merchant cash advances and title loans, Invoice Financing is an inexpensive way to fund your business. No extraneous fees, just a set rate.

⑤
Receivables Management

Working with an asset based lender, like SouthStar, helps reduce the various expenses associated with processing invoices and collections. We will handle your collections, so you can concentrate on managing your business and not having to worry about day-to-day accounts receivable.

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Why Invoice Financing may be better than a Business Loan

Jan 09, 2017 Posted in AR Financing, Invoice Financing, Small Business

Invoice Financing vs Business Loan

Invoice Financing may be better for your
company than a Business Loan.

Invoice Financing vs Business Loan

According to The Service Corps of Retired Executives (SCORE), 82% of start-ups and small businesses fail because owners have a poor understanding of cash-flow management and lack the ability to access working capital needed for growth.

One funding option that is often overlooked is invoice financing. This alternative lending method does not have the same strenuous requirement process as a traditional business loan. The main qualification is that a company has customers with outstanding invoices that are paid on terms. Below, we will take a look at why invoice financing might be a good fit for you.

Invoice Financing means...

Navy Triangle

No Debt Added

Invoice Financing doesn’t require a company to take on additional debt or have the pressure of paying back debt. The less debt acquired, the better your balance sheet, financials, ratios and investor perception. It also allows companies to receive needed capital without the hassle and risk of a loan.

Quick Funding

If a company needs money fast, there are few better options then invoice financing. In 2-3 days, a company can receive up to 90% of their outstanding invoices. After initial funding, capital can be provided within 24 hours.

Simplistic, Fast Process

In order to receive a bank loan, a company has to provide all of their financial statements, have very good credit, and have been in business for a good amount of time, generally more than 3 years. In contrast, invoice financing lenders are mostly concerned with the credit of the entity (debtor) that owes on the invoice, or your customer. This non-traditional approach takes a lot of pressure off the company in need of money.

No Debt to Payback

Because the money advanced is not a loan, it does not have to be paid back. As a result, there are no payments, principal, and interest to be made. The invoice is paid back by your debtor when payment is due and they receive no hassle about early payment, in turn increasing customer satisfaction.

3rd Party Handles Collections

Most Invoice Financing lenders will also handle collection duties for all invoices (even invoices not being financed). This service can provide huge savings for your company, as well as the ability to concentrate on managing your business and not having to worry about collections.

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