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Factoring is the selling of your invoices to a factoring company for cash at a discounted price.
Factoring provides the opportunity for you to get the cash you need as quickly as possible without the hassle of collecting debt. However, you lose some of the value of the invoice.
The factoring company in turn, collects the debt causing you to lose some of the value of your invoice. This is how a factoring company makes a profit, by providing you with a lesser cash value than the face value of the invoice.
Benefits of Factoring:
1. Provides access to money quickly
2. Prevents concerns regarding the collection of bad debt
3. Turns invoices into immediate cash, increasing your cash flow and strengthening your purchasing power
4. Provides the opportunity to borrow money with the security of your debt.
Can factoring help you?
Our combination of financial strength, personalised service, and over 16 years of success, sets us apart from other factoring companies and places Platinum Funding UK Limited in a class of its own. We specialise in invoice factoring, debt factoring and sales ledger management services, a useful tool for growing companies that may not have the ability to access traditional financing sources.
Invoice finance is the process of selling your sales ledger. It rapidly turns invoices into cash and leads to efficient sales ledger management, eliminating stress, waiting and worrying. Our invoice finance services provide our clients with an unlimited funding ceiling. When partnering with an invoice factoring company such as Platinum, as compared with alternative funding solutions, you need not be concerned with the loss of equity and ownership in your company or the accrual of additional debt.
If you would like to find out more about factoring or if factoring can help you, please contact Platinum Funding UK Ltd, a UK invoice factoring company that stands out among other invoice finance companies. Platinum Funding UK Ltd is strongly committed and dedicated to the long-term success of your business through our valuable factoring finance services.
Here are some examples of how factoring can help you:
Example: Provides access to converting invoices to cash quickly
A company owes you £7,000 and they do not have the ability to pay you for a few months. By selling your invoice to a factoring company, an invoice factoring company will provide to you an up-front advance of £4,900 almost immediately, against the purchase of the invoice. The factoring company will then collect the full amount of £7,000 from your customer and pay the balance to you less its discount fee.
Example: Prevents concerns regarding collection of bad debt
A company owes you money, for example £20,000. It has become increasingly difficult getting the company to pay you back. When you sell your invoice to a factoring company for £14,000, the factoring company takes on the debt risk also known as non-recourse factoring. This means that you do not have to repay the advance if the debt is not paid. The factoring company then takes full responsibility to recover the money.
Example: Turns invoices into immediate cash, increasing your cash flow and strengthening your purchasing power
Your invoices are £50,000 a month and there are multiple clients all paying at different amounts of time (30,60,90 days). This type of situation leads to money coming in at multiple times although the invoices are issued at a steady pace. This type of scenario can cause great difficulty in trying to smooth your cash flow.
A factoring company collects your invoices. The factoring company pays you for the invoice almost immediately. Factoring companies endure not only the debt but also handle your sales ledger for you.
What is Sales Ledger Finance?
Sales Ledger finance is another term for Invoice Finance. Invoice Finance, or Sales Ledger Finance, allows you to turn your invoices into cash. Platinum Funding UK Limited, a full factoring company, buys open invoices/accounts receivable in a non-recourse transaction. We advance a significant portion of the value of the invoice upfront.
Through the factoring services provided by factoring companies you can increase cash flow, maximise working capital enabling you to pay your suppliers on time and take advantage of discounts, prevent the hassle of missing payroll deadlines, and, most importantly, grow your business.
What is Non-Recourse Factoring?
Non-recourse factoring is the endurance of the debt on the payable invoices. Your business is not responsible for the cash advance amount or fee. In non-recourse financing, the financing company is responsible for receiving payment from the payable invoice.
Factoring is a great and easy way to turn your invoices into cash fast.
Platinum Funding UK Limited, a full factoring company, is known throughout the factoring finance industry for being fast and efficient. With adequate information, typical turnaround time from the initial communication regarding invoice factoring with a Platinum representative until receiving the requested funding through invoice factoring is approximately 3 to 5 business days.
On our website, at www.platinumfundinggroup.co.uk, you can learn more about factoring and if it is right for you. We also provide helpful services including free online consulting for both clients and introducers.
