Frequently Asked Questions

Why Do Purchase Order Finance Transactions Require Inspections?

inspecting goods

Most purchase order finance companies typically require that the goods they are financing be inspected by an independent company prior to shipment. Usually, the inspection company verifies that the quality, quantity, shipment date, and other parameters meet the specifications of the purchase order. The inspection clause is usually written into the language of the letter […]

Is Invoice Factoring the Right Choice for My Company?

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Invoice factoring is designed to solve one specific problem. If you have this problem, factoring solves it and improves your cash flow. However, if you don’t have this problem, factoring invoices won’t help you that much. Is this you? Do you sell your product and/or service to commercial clients who demand payment terms? If you […]

How to Choose the Best Factoring Company

jig saw puzzle of financing

Selecting the best factoring company for your business can be daunting, and many business owners approach the process haphazardly: they search the Internet, pick the top four or five companies from the listings, and then seek proposals from all of them. In the end, this process consumes a lot of time and does not always […]

What is a Factoring Notice of Assignment?

due diligence

Clients often ask, “Will my customers know that I am factoring?” The answer is yes, your customers will know that you are using factoring because they receive a document from the factoring company that informs them of the relationship. This document is commonly known in the industry as the Notice of Assignment or, simply, NOA. Most […]

Advantages and Disadvantages of Invoice Factoring Financing

man in business finance conference

Factoring financing has been gaining popularity as a way to finance a growing business. If you are not familiar with this type of financing, you can learn about it in detail by reading, “What is factoring?” Factoring is essentially a financial tool that allows you to finance your slow-paying invoices from creditworthy customers. Using your invoices as collateral, the […]

Benefits of Factoring Invoices

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Factoring has been gaining popularity in Canada as a solution for companies with cash flow problems that stem from slow-paying customers. Basically, most large corporate customers take as long as 30 to 60 days to pay an invoice. These companies include a provision in their contracts that allows them to use this common business practice. […]

Should You Factor Invoices That Are Collections Problems?

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Every so often we get a call from a prospect interested in factoring old invoices. By “old” we mean an invoice that is substantially past due – 120 days old or more. The short answer is that those invoice are impossible to factor and no factoring company will purchase them. A factor will purchase a slow-paying invoice from […]

Can an Invoice be Factored Before Delivery?

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There are times when clients are in a big hurry and need funds quickly. They often ask whether an invoice can be factored before they have finished providing the service or before the product is delivered. In other words, they need funding before they invoice the client. Unfortunately, an invoice cannot be factored prior to delivery. By […]

The Importance of the Accounts Receivable Aging Report

a/r aging report

The Accounts Receivable (A/R) Aging report is a critical tool for managing your business. Most factoring companies request an A/R Aging Report as part of their application package because it gives them a good idea of your receivables portfolio. Surprisingly, a number of companies do not have this valuable report available – a sure indication that they […]

Why Can’t You Factor Net 90 Invoices?

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One of the side effects of the global recession and credit crunch is that clients are taking longer to pay invoices. Customers who paid in net 30 days are now paying in net 40 or net 60 days. Because of this trend, many commercial customers are now paying invoices in net 90 or more terms. […]