Accounts Receivable Financing for Consumer Contracts
What is Accounts Receivable Financing?
Accounts receivable financing is a type of factoring that helps companies increase capital by utilizing the accounts receivables based on consumer contracts - money owed by customers. A company may have contracts or agreements with customers that require the customers to pay over a period of time for the services or products they receive. During the course of payment terms, the contracts are held in the companies as accounts receivables. In the perfect world, companies receive incremental payments from the customers at the right time. However, even this may take months or years for a company to recoup the cost and make a profit for the products or services the companies rendered. There are also cases of slow pays or no pays. Accounts receivable financing, thus, helps reduce the risk of the above scenario by transferring the risk to the financing company. With this process, companies will receive amounts that equal to an agreed upon reduced value from the financing company. Because of the time value of money, companies will now be able to reinvest the capital, meet payroll, take on larger projects, etc. Companies will also be able to shift their focuses from collection of accounts receivables to other viable business activities.
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Who benefits from Accounts Receivable Financing?
business owners, c-suite (senior executives), investors, employees
- Since accounts receivable financing helps increase capital quicker, business owners and senior executives will more likely be able to grow their companies faster, employees will be able to receive raises sooner, and the investors may even be able to see their dividends grow more rapidly in a shorter period of time.
How do I find out more about Accounts Receivable Financing?
Since every company is different and each product or service is unique, it will be the most prudent to contact Access Funding Center, Inc. for a free consultation. Access Funding Center, Inc. specializes in accounts receivable financing that relates to consumer contracts.
- To contact us by phone: call 864-603-3539 - To contact us online: click here