Business loans & invoice factoring

Getting a business loan may not be that easy given the current economic scenario. It does not matter whether your company is small or big, the answer is going to be along the usual lines “we’ll be in touch” and that’s the last you get to hear from these guys, at least, in the immediate future. What does this mean for the small businesses and the medium sized companies? As for the big guys, they have leveraged their positions so much, that no matter what, they’re not going to be hard put to come up with cash.

Does this mean the end of the road for you as well as other mid-sized companies? Of course not, it merely means that you need to rethink the situation and come up with viable alternatives. From factoring to invoice discounting, you can apply for any of these options for an immediate injection of cash into your business. Naturally, these options have their own pros and cons, the pros being a immediate supply of cash set against your invoices and as for the con, it may require you to open up your books to third parties.

Keep in mind that I’m not talking about a bank overdraft, so there is a certain amount of flexibility available with these options. Of course, you may have to settle for 80% of your invoice amount or less, but you’ll be getting an immediate injection of cash. As a company, it is essential that you have a steady cash flow so your company can continue to grow, making more money in turn.

Any stagnation in cash flow can lead to fiscal issues, from a drop in production to being unable to meet the most basic obligations on your part. You can utilize either factoring or invoice discounting to get the cash you need within 24 hours or so. You may be required to provide certain amount of documentation on your part to make this happen, from balance sheets to other financial data. If you’re planning to apply for factoring or invoice discounting, take the time to get the documents ready and if you’re still not sure what it is all about, do the research and you should be able to get all the information you need to make a balanced decision.