Are you aware of the concept of invoice factoring or bill factoring or accounts receivable factoring or invoice financing? They are different names of the same thing. In the invoice factoring, the business owners get immediate cash from the invoice factoring companies against the account receivables of their clients. Likewise, the Oilfield invoice factoring is a financing solution for the business owners and suppliers who need immediate cash.
This system enables small, medium, and big businesses to carry out their business efficiently and successfully without waiting for the payment from the clients for many days, weeks, and months. This method is used by many business owners who want to run their day to day expenses and wish to grow their business too.
Factoring is a very simple process. An oilfield company or oilfield supplier offers services and products to their clients. When the company generates the bills to the customer, the company sends these bills to the factoring company. The factoring company pays them back and later collects the invoice amount from the client.
Before providing the cash against the invoices, a thorough and detailed background check of the business and their clients is done to avoid any confusion and fraud later. The factors that are taken into consideration are many such as the client’s paying ability, his credit history, and much more. It generally takes about a week to a month to complete the process. After all the paper work, checks, and documentation, the payment is disbursed to the companies. After the bills are received and validated, the funds are released as soon as possible.
The factoring company may ask for many other documents from the businesses along with the regular ones. When the freight invoice company receives the bills, they normally provide 85% to 90% of the amount instantly. The remaining amount is paid after receiving the payment from the client. In this amount, the invoice factoring companies deduct their fees and charges too. The mode of payment of the amount can be decided as per the mutual agreement between the two.
Staffing agency factoring is also called as the payroll factoring. It is identified as a great way to convert non-paid bills to cash. The staffing factoring collects the bills on behalf of the company. It is indeed responsible for inculcating confidence in the businesses that lead to a successful running of their day to day business with the help of cash in hand. Staffing factoring can be used by any staffing agency, IT agencies, Health care firms, Human resources firms, and many more.
Staffing factoring has become a backbone for different businesses. If you have a business and you face similar problems, you must resort to the staffing factoring too.