Factoring vs. Bank Loans

Is factorization a type of loan?

No. Even though bill factorization is commonly referred to as “ factorization loans”,
it is a financial pattern involving a B2B transaction, but no bank. To additional explain, account factoring, it is when a company, like Peacock Capital,
purchases your accounts receivable bills at a price reduction and supplies you with
contiguous cash. A traditional bank loan utilizes your company’s accounts receivable as
collateral, where account receivables factorization looks primarily at the financial
soundness of your customers, not your company. Banks are regulated heavily; large
finance companies generally are public and driven by pressure levels in the financial
markets. When modern times are tough, banks and finance companies bounds lending. A small
business, too new to have got a path record, with a weak balance sheet, with a history
of financial problems, in turnaround time manner or undergoing large changes, often cannot
happen a willing lender at any price. That is why factorization is best for small to mid-sized
businesses.

Does a bank loan do more than sense for my small business than bill factoring?

No. Banks often have got restrictive lending demands relating to cash flow,
profitability, equity, and old age in business, which forbid them from making
loans to small to mid-sized businesses. Since factorization companies are not
in the lending business and there is really no such as thing as “ factorization loans”,
the determination to purchase bills is influenced primarily by the quality of your
client alkali and their financial stability, and not the financial basics
of your company.

Do Iodine have got got to leap through the same hoops for account receivables Factorization as with
bank financing?

No. All Peacock Capital needs to bring forth a proposal is a completed pre-approval
form, summary of accounts receivable aging, summary accounts collectible
ageing and some other basic financial information.

Do Iodine have to be an constituted business operating a minimum number of old age to
begin an account factorization human relationship with Peacock Capital?

No. Peacock Capital pridefulnesses itself on working with companies in all stages of
business, including recently developed small to mid-size businesses. Even pure
start-ups are usually not a problem for Peacock Capital. If your company have
verifiable bills and creditworthy customers, Peacock Capital will happily talk
with you about an account receivables factorization relationship.

Are my receivables held as collateral while my company is factoring?

Yes. Peacock Capital necessitates a first place on all accounts receivable while you
are factorization with us.

Does Peacock Capital necessitate further collateral when my company is factoring?

No. Within our traditional account factoring programs, a first place on accounts
receivable is all that Peacock Capital necessitates while you are factoring. In some
situations, Peacock Capital may take an available security interest in other
company’s assets.