The Lifecycle of a Factored Invoice

As your factoring partner, we know all about the processes that go into factoring invoice and receivables to help you optimize your accounts receivables to support your operation’s growth. Yet haven’t you ever wondered what it would be like to take a quick peek behind the curtain to see exactly what goes on in life of a factored invoice. Having a comprehensive understanding of the AR financing process can help to reinforce your faith in its benefit to your organization.

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What Happens After It Leaves Your Hands

It all begins when you receive and fulfill an order for either goods or services. You continue to invoice your customer but also send us the invoice data, the receivable is then recorded into our records. The invoice has a quick verification process and then you are wired funds directly to your account. A small % of the balance of the invoice is placed into a reserve account. We then wait to receive either payment or remittance advice from your client pertaining to that invoice. Payment methods may differ from the manner in which you once collected them, as we often need to offer multiple options to help accommodate the needs of your many clients. These may include:

  • Electronic payment options
  • Physical invoice collection
  • Automated payment lock-boxes

The system then credits your accounts for payments received and applies funds towards any advances that have already been extended to you. Once the invoice has been settled, its record is maintained in the system for your convenient access. The remainder balance is then released to you less the factoring rate. This entire process can be tracked through our online portal for e-Factor.

What if Your Client Doesn’t Pay

If you’re like most, you also worry about what happens if the invoice goes unpaid. In some cases, it may have already been approved for you to receive payment on the uncollected receivable, making its collection ultimately our responsibility. Where that’s not the case, the invoice may simply be returned to you or traded out for another invoice in the future.

Here at Universal Funding we understand that transparency is one of the keys to maintaining a successful business relationship. Thus, we won’t ask you to simply rely on our expertise when it comes to financing your receivables. We firmly believe in the philosophy that an informed client is a happy client. We’re ready to handle any questions that you have regarding your invoices once you’ve entrusted them into our care. To see for yourself just how much our expertise can benefit your company, we invite you to fill out our convenient online rate form.

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