First Name:

Your E-Mail:

Welcome Guest

Candle and Soap Making Articles Directory » Finance » Credit » Factoring can help with late payments

Factoring can help with late payments

View PDF | Print View
by: Tom Sangers
Total views: 1663
Word Count: 285

Factoring can help with late payments

Recent surveys have suggested that there are growing concerns amongst UK SMEs over the increasing trend in late payments.

After further research conducted by a leading credit information company highlighted that businesses were now taking over two months to pay their bills (on average), which was an increase of nearly two days since 2006. It appears the problem is getting worse and that late invoice payment is a deeply-embedded trait of UK business culture.

Many commercial finance providers are urging SMEs affected by late payments to look to Factoring to release cash tied up in pending payments. Factoring is a flexible type of business loan which allows a business access to cash as it issues new invoices. A Commercial Mortgages specialist or factoring company will lend a certain percentage of the value of that invoice (normally up to 85%). It will then collect the invoice which when becomes due, gets paid back to the issuing company. The commercial mortgage specialist or factoring company will then charge a small percentage of the value of the invoice, and interest (of course) on the borrowed money.

In many cases, the release of cash from tied up invoices allows businesses to pay suppliers sooner and negotiate further discounts on this basis. Michael Thommes, MD of large Commercial Mortgages provider General Finance Centre, also points out that “many companies prefer to use a factoring or invoice discounting facility over an overdraft, as the advance can be comfortably increased in line with your business’ successful development”.

Visit General Financecash_flow_finance.htm to find out more on how to release cash from your business’ invoices.

About the Author

I write for and behalf of General Finance Centre


Rating: Not yet rated

Comments

No comments posted.




Add Comment

You do not have permission to comment. If you log in, you may be able to comment.
Articles

Candle Making Business Resource l

©2010 CandleBusinessCorner.com - All Rights Reserved