How It Works
Need quick access to working capital while waiting for customer invoices to be paid? Consider invoice factoring, also known as accounts receivable financing. This option is ideal for businesses that may be waiting as long as 30, 60 or even 90 days to be paid for their customer invoices.
With invoice factoring, you can sell your unpaid invoices to a factoring company for immediate cash. The process is simple and hassle-free, with most businesses receiving funds within a few business days of approval. Typically, factoring companies will advance up to 80% of the amount of the accounts receivable, providing you with the financial flexibility you need to keep your business moving forward. So why wait? Contact Fluid Capital Partners today to learn more about our invoice factoring services.
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1.
Customers submits an outstanding invoice to Fluid Capital Partners for review.
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2.
Fluid Capital conducts due diligence, which includes verifying that the invoice is accurate, that the business is legally established, in good standing for tax purposes, and that there are no pre-existing liens on its accounts receivable and/or invoices.
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Customer assigns ownership of the invoice to Fluid Capital Partners by signing a Notice of Assignment.
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4.
Fluid Capital Partners funds the customer 80% of the invoice amount. 20% of the invoice is considered reserves.
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5.
Depending on how the transaction is structured, either the client or clients’ customer pays the invoice balance to Fluid Capital Partners.
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6.
Upon full payment of the invoice, Fluid Capital Partners returns the invoice balance to the customer minus the setup and transaction fees.
How is invoice factoring different than a bank loan?
During the application and approval process, factor companies focus a bit more on the creditworthiness of the company being invoiced, while banks focus on the financial history, collateral and cash flow of the company requesting the loan. Accounts receivable funding is not a loan. Consequently, debt is not entered on your company’s balance sheet. Fluid Capital Partners can often make quick funding decision, whereas banks may take weeks– or even months–to approve a loan.
