Factor Group

1. What is a factoring?
 

Factoring is a financial tool in which a company sells its current account receivables that are on open terms at a discounted rate, gaining immediate working capital to meet their obligations. It is also known as Accounts Receivable Financing and Accounts Receivable Factoring.  It is alI

2. How would my company benefit from Factoring?
 

The most immediate benefit is increased access to liquidity which can be used for any working capital need, such as sourcing more of your products and paying ongoing expenses. Other benefits include being able to offer flexible credit terms to customers, the outsourcing of time intensive and expensive credit and collections work, taking advantage of supplier discounts and ongoing professional credit monitoring of your customers.

3. How would my company benefit from working with Factor Group?

By gaining access to a timely, dependable funding source. Our seasoned professionals are a well-respected presence in the factoring and commercial finance industries. And the Factor Group is known for its satisfied long-term clients and transparency in its business dealings. 

4. How can I secure my company’s payroll by selling my receivables? 

By factoring your current outstanding account receivables, your company will accelerate its cash-flow cycle, making it possible to meet payroll obligations on time and attract and retain the best employees. 

5. I have an invoice which my customer won’t pay. Can Factor Group help? 

Factor Group provides working capital based on your creditworthy customers. It is our standard practice to only factor those invoices that will be paid. If you require a collections agency, we may be able to assist you by referring you to a list of qualified collection agencies.

6. What information would be requested by Factor Group in order to start the enrollment process?
 

Please refer to Factor Group’s application  where you can see all of the questions we ask and documents required for our analysis of your company.

7. Does Factor Group require that I factor 100% of my invoices?

No – you have the option of deciding which accounts you wish to factor as well as the invoices that you wish to factor..

8. If my company enrolls with Factor Group in the Account receivable program, will this harm the relationship with my customers?

No. Factoring is a well-established strategy around the globe for many companies to fund their operations. Many new to the industry are surprised to discover how widespread it is and how many large organizations use factoring to manage their supply chain and customer relationships. With this in mind, our initial set up with your customers is handled with the utmost care by professionals and is truly a three way process. Creating excellent customer relationships is one of our strengths and the reason we have so many long-term clients. 
 

9. Does Factor Group works with small and large businesses?
 

Yes. We cater primarily to small and middle market businesses, and through our network of affiliates, we are able to assist large corporations.

10. If my client is located oversees will factor group fund my receivables?

Yes. Factor Group has international expertise and purchases foreign receivables. Like any other company, an overseas client must be approved by our credit department and comply with our contractual agreement with your company.
 

11. Does Factor Group require a minimum of receivables to start working with my company?

Typically, we require a minimum of two accounts to be factored with at least one invoice per account.

12. If my company is going to start working with a new customer, does Factor Group provide a credit check and references?

Credit analysis is the first step we take when deciding to factor a given account. At times, trade references or additional financial data is requested if there is little or no information on a given company.

13. Does Factor Group work with Brokers?
 

Yes. We have a network of brokers nationwide and are constantly seeking new broker relationships.

14. What is the benefit of working with Factor Group instead of getting financing through a bank credit line? 

Lines of credit are typically based on your company’s historical financial performance and require restrictive covenants. With factoring, the amount of funds your company has access to is only limited by the amount of sales you have to creditworthy customers.

15. Why factoring is a tool for Small businesses?
 

Most small businesses do not meet banks’ stringent underwriting criteria. When a client factors its receivables, the underwriting decision is based on your customer’s creditworthiness, not yours. Factor Group is a better alternative when seeking a working capital loan or a traditional small business loan.

16. Does factoring increase my company’s cash flow?
 

Yes. In most cases factoring is used as a tool by companies to get the cash they need to take advantage of opportunities that can increase sales or obtain better supplier credit terms. Without this liquidity, they would have missed out on these opportunities.  Factoring allows businesses of all sizes to become more competitive through the offering of flexible credit terms to existing customers or to sell to new markets that require longer payment terms..

1. Do I have to pay any fee to become a Factor Group client?

Due Diligence fees may be charged by Factor Group, depending on the type of underwriting needed and any third party agencies. Upon receipt of your application, Factor Group will evaluate the file and inform you of any fees due on our written proposal.

2. How long is Factor Group’s application process? 

The time it takes for account setup is related to two variables. The first is the credit approval of your customers which can range from a few days up to a few weeks for companies that are selling internationally. The second is how quickly your company can provide the required documentation. With credit approvals and documents in hand, we can issue a decision very quickly. 

3. Does my company have to be incorporated and for how long to be approved by Factor Group?

We can work with start-ups through established companies; however, in order to set up your account, your company must be registered in the state from which you conduct business. 
 

4. From the moment my company is approved, how long does it take to receive the first funding?

Sometimes as quickly as the same day, most often within 24 hours. If an invoice can be verified on the day it was submitted, we can fund on that same day.