PCL Money - Factoring

Factoring

Factoring is a disclosed or non-disclosed financial facility that is designed to improve a company’s cashflow. It provides up to 90% of the value of the approved invoices, with the remaining balance, less charges, becoming available to the client once payment is received from their customer. This facility is a recourse facility.

In addition to turning invoices into working capital, factoring provides additional services that are key to modern business.

	The collection of debts can be undertaken by a highly skilled team of Credit Officers who balance sensitivity with the need to collect a debt quickly and efficiently.
	PCL will provide regular, up-to-date sales ledger administration and control information which will give the client a true picture of their company’s sales account.
	A client can also select a factoring agreement, whereby the client will retain control over the collection of debts.

Factoring can also be used to help businesses importing goods, especially from China; All we need is:

Applicants preferably trading 12 months and have a profitable history

The (Chinese) supplier must be acceptable to the financier

The client is charged and assistance and success fee - the financier does not pay brokerage

Preferred term 30 to 90 days

Preferred use of the facility 3 to 4 times a year

Minimum funding $20k with no maximum

Applications approved in 6 weeks

There is no charge over the the business; no mortgage security is required. however directors' guarantees may be required for "marginal" applicants

The facility can be used to top up existing client funding arrangements and does not restrict the client's current or future debtor funding arrangement

Factoring is ideally suited to clients who:

	Have a cashflow issue created by the receipting cycle of debtors
	Are looking to make opportunities in the business a reality and require cashflow or a recapitalisation to do so
	Are looking to expand the business and require funding to meet creditor terms and stock levels
	Require a very flexible cashflow system to allow the business to reach the objectives of the directors and shareholders
	Cannot produce monthly management accounts
	Require a formalised approach to debtor management including reporting
	Can have traded negatively or positively
	The balance sheet position can be weak or strong
	Do not qualify for traditional banking products
	Are trading out of difficultly with creditors and/or the A.T.O.

The circumstances of individual clients can vary greatly thus each client is assessed and then negotiated with on an individual basis with the relevant information being provided.

To learn more about how factoring can assist your business, contact us today.

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