For enterprises ineligible for conventional forms of capital, such as loans, factoring has been advocated.
Simple enough, you sell your unpaid invoices to a financier in exchange for the rapid settlement of your outstanding balance.
The process may not work for all organizations, based on our experience, and small businesses typically have difficulty factoring in their bills for various reasons.
1. “Too small for us.”
Generally, the larger financial institutions prefer to factor in more significant invoices. It increases their interest and charges income.
The applications of smaller enterprises with smaller invoices, regarded as less desirable, are typically refused.
2. “Give us more.”
You must register all incoming bills with more prominent banking institutions.
A company that wants to factor bills on a case-by-case basis is isolated.
3. “Too young for us.”
However, even if a company has done business with a respected company in the past, it may struggle to acquire permission.
Traditional financiers place a high value on track records and years of experience.
4. “We need more assurance from you.”
Most factoring arrangements need directors to sign personal guarantees.
Owners of private limited firms who want to keep their personal and corporate finances separate will not be pleased with this situation.
5. “Application anxiety.”
Traditional bankers’ long approval delays and opaque criteria cause a great deal of stress and confusion for smaller enterprises with tighter cash flow demands and those who require financing on short notice.
With Multiply, you can make factoring work for you.
Your choice is which invoices to factor! Neither the size of the invoice nor the size of the company is an issue for us.
In less than two days, you will hear from the Multiply team.
We will not ask for personal guarantees provided you meet our transparent and open conditions.