If your business requires additional capital, you can opt for a conventional bank loan or alternative financing. However, with frequent difficulty in securing loans from banks, invoice finance Auckland or factoring has gained a lot of popularity as a feasible financing option.
Invoice financing has become a viable source of working capital for many small to medium businesses and it is easy for you to sign up.
Improved Cash Flow
When compared to conventional loans from banks, using invoice finance Auckland provides a predictable source of working capital or cash. Invoice factoring creates larger liquidity allowing you to cover your expenses in a timely fashion and use the additional money to take advantage of the opportunities that might be available for you. The best part is that you get to do this without creating debt.
Quick & Convenient
Banks and other lending institutions have strict requirements and ask for a lot of paperwork which makes the approval process daunting, lengthy and complex. It can take a number of weeks or even months for the institution to make its decision and even end up not approving the loan after all that time. Well, Asset Factors provides a number of appealing reasons why business owners prefer it over traditional bank loans.
We all know that time is money when it comes to running a business and the time spent trying to get a loan approval is one that you could spend on other opportunities that help grow and expand your business. When you use invoice finance Auckland, the money is released almost instantly, providing access to quick cash flow. If you pick a reliable lender, you could have the capital you need in less than 24 hours.
No Long-Term Debt
One of the best things about invoice financing and what makes it way better than conventional loans is that no debt is created. Given you are only leveraging the collection of invoices that will be settled in the future, (which results to an increase in cash and a reduction in accounts receivable balance), you will not face the hurdle of dealing with loan repayments. However, before you go down that path, how do you know that using invoice finance Auckland is better?
Even though financing through loans is usually less expensive, invoice factoring and discounting include several services that can significantly reduce your admin costs. Fees usually include services like investigating the credit health of your clients, determining the credit limits of your customers as well as collecting the receivables. When these tasks are done on your behalf, you enjoy operating efficiencies and this saves you both time and money.
Ideally, there is no commitment with working invoice financing and this allows you to finance on an as-needed basis. With that in mind, when you factor in the terms and conditions of a conventional bank loan as well as the rates, they can certainly end up costing more in the long haul.
As you can see, there are many benefits of invoice financing that you can’t enjoy with a bank loan. For fast invoice financing or debt factoring in New Zealand, get in touch with Asset Factors a visit today.