Is your business expanding? You must be needing extra funds to finance your meeting payroll, expansion costs, purchasing equipment and to cover other unforeseen expenditures. Every business has its unique financing needs and not every finding option is ideal for it. In today’s market, there are various ways of funding your business.
A bank loan is one of the oldest methods that businessmen have used. Some even prefer it now. It gives you the loan to invest in your business. The borrower is then required to pay back the money with interest within a stipulated time. Mostly it’s found that banks provide less, but charge so, so funding your business through this method might end up hurting you more than helping you.
Invoice factoring is a comparably new alternative. It allows your business to maintain a stable cash flow. These companies let you receive your unpaid invoices on time so that you can generate capital flow. This process is fast and hence more preferable than the former. We would now give a detailed account of why is the latter better than the former.
Application Processing Times
Once you have completed your paper works, banks take months to start the process of granting you loans, whereas a good invoice factoring Singapore company gives instant approval within 24 hours. As soon as it’s approved, your business would start to revive funds and unpaid invoices from the company.
Approval and Setup Process
Banks consider a variety of factors before approving your request for a bank loan. They check your credit score, business records, collaterals, etc. Getting your job done by factoring companies is hassle-free. Even if you are new in your business and have a low credit score, you can still avail of its services.
Banks are extremely rigid in their terms and conditions. Once you have signed in your papers, it becomes extremely difficult to make changes to them. On the other hand, factoring companies are flexible and are aimed at allowing your business to grow. The more your account receives payments, the higher your credit score grows.
When choosing the best financing method make sure you choose the one that meets your immediate financing needs. Also, choose the one that is more flexible and approachable. No matter yours is a long-established industry or a new start-up, invoice factoring is becoming an extremely popular option to consider.