Why Would You Use A Debtor Finance Facility Over Traditional Lending?

Debtor finance facility – Factoring has been around for a long time. People often tell myself, that the reason they are coming to Factoring – Invoice Discounting is because the banks won’t lend them any monies. Why is that? I ask.  They proceed to tell me a number of reasons:

1. I have no assets

2. I have no trading history

3. I have credit problems

4. My business is too small.

With these answers in mind, from a bank point of view, why would they take a risk? They were never interested in young businesses, they want large well established ones. Banks really don’t micromanage well and often causes smaller businesses, heart aches and pain.

Which brings me back to to my question. Debtor Finance Facility, Factoring, Invoice Discounting products are all funded against invoices. The security in the whole loan is primarily the debtors and their strength. Lenders keep exposures and limits in check, helping avoid any situations which will leave you, the client, vulnerable.

Factoring, Debtor Finance firms will do checks on Debtors, maintain alerts to try and avoid any bad debt decisions. Most Factoring firms only care about the invoice Finance, and let owners get on with business lending.

Lastly Debtor Finance lenders try to assist you in the growth of the business. It’s in their interest for you to grow, so they make more money. The most important things owners should ask are:

With Factoring lenders, the deal is smooth and Fast

1. What will I do with the funding once I get up to 80% of the invoices in 24-48 hours?

2. Do I want to be in a contract or not?

3. How long do I want to be in a product for?

4. What is my long term solution once I get to my growth phase?

5. How do I get out when the time comes?

Trade Debtor Finance Consultants ( TDFC ) offers a written obligation free quote which puts you in touch with up to 4 appropriate lenders for you to choose from. TDFC also offers support for the life of the loan, offering help and or feedback on the do’s and don’t’s. TDFC has a large range of references now for your firm to choose form.

So if you would like to get it first hand, with up to 22 lenders and 9 different products to choose from, contact Trade Debtor Finance Consultants today and help a Small Family owned Business today. A debtor finance facility may just be what your looking for to maintain your cash flow at a reasonable state. Contact us now.

www.tradedebtorfinance.com.au or sales@tdfc.com.au

For a definition of Debtor Finance go to http://en.wikipedia.org/wiki/Debtor_finance

Leave a Reply Cancel reply