What is factoring?
Factoring is a transaction where a business sells its invoices to an invoice factoring company to gain access to the cash tied up in outstanding accounts receivables. These invoices or receivables are removed from your books and are added to the factoring company’s balance sheet at their fair value.
The factoring company is purchasing these accounts receivable at a discount rate and then waiting on your customers to pay the invoice, whether that is 30, 60 or 90 days later.
How does invoice factoring work?
Here is an example of how a transaction may work;
Note: All advance rates and discount rates or fees are agreed upon while being set up.
Invoice Factoring Key Points
|Great For:||Business small and large with receivables Eg Staffing, Oil & Gas, Transportation, Manufacturing etc.|
|Funding Amount:||10K-25 Million Dollar Lines|
|Discount Rate:||0.3% - 4%|
|Years in business||No requirement! (We have funded many great startups)|
|Qualifications:||Creditworth customers and invoice B2B or B2G customers|
|Repayment Terms:||Client pays to factor on terms. Typically 30-90 days.|
|Application Process||Easy and Online, E-sign enabled|
How do I get funded by a factoring company?
Here are the 4 main steps.
1. Quickly Sign Up – Just provide your full name, email and create a password.
2. Apply & Submit Info – Fill out and upload some basic information about your business and have a discussion regarding your company with one of our representatives.
3. Get Back To Work – Get back to doing your job while we get everything set up for you.
4. Accept & Submit for Funding – Sign our contract and upload invoices for verification and funding
Why use Meritus Capital for Accounts receivable factoring?
Meritus has provided billions in funding over the last 19 years in the United States and Canada to hundreds of businesses. Combined with our experience comes great service, the lowest rates, and an easy to use online onboarding process.
Here are a few details of our invoice factoring program and why we could be the right fit for you.