Although invoice factoring might interest your company, one of the best ways to know if it’s right for you is to thoroughly research the process. The best factoring companies try to make the process easy on your business. Universal Funding helps you to clearly understand the different roles involved with getting your business the cash it needs through the sale of your accounts receivable.
You need to maintain a good relationship with your customers, even when you factor their invoices. You provide your service to your clients and draw up an invoice. A copy may be sent to your clients so they know what to pay. If you choose to use invoice factoring, you then send the invoice to us as well. Typically, the more invoices you factor, the lower the rates will be.
The Role of the Factoring Company
We pay you a certain percentage for the invoices as per our agreement. We notify your customers of where they need to send payment that is made out to your company. We then wait for your customers to pay the invoice amount within the terms you agreed upon. If the amount is left unpaid, we work with your business for further options. Once the customers pay in full, we can give you the remaining balance you are owed, less any fees.
Your Client’s Role
Your client gets to continue business as usual. There is nothing out of the ordinary for your client during the invoice factoring process, except where they need to send payment.
We Make It Simple
Invoice factoring does not have to be a convoluted process. It is not like applying for and paying back a loan. You do not need to calculate interest or arrange for installed repayments. It all breaks down to this process:
- You provide goods or services to your clients and send them an invoice
- Your send a copy of the invoice to your factoring company
- The factoring company pays you a specified percentage for the invoice, usually 80-90%
- Your clients submit payment, made out to you, to the factoring company lock box for processing
- You receive the remaining balance for the invoice(s), less any fees
This process can be monitored in real time online through our eFactor log-in. Contact Universal Funding today, or fill out online rate form to get more valuable information.