Accounts Receivable Financing (Factoring)

Star Financial Resources Accounts Receivable Financing (Factoring) Acquire flexible working capital quickly - using your outstanding invoices to bring immediate cash into your business.

Invoices are considered assets, but they have no liquid value until they are paid. When you need cash flow to obtain materials for a large order, expand your operation, or to meet your payroll, you can sell your invoices to a third-party funder and realize 60 to 90 percent of the invoice balance in 24 to 48 hours - accounts receivable financing is quick cash when you need it most! It also puts liquid funds in the asset column, improving your balance sheet and making you more attractive to lenders, investors, and even potential purchasers.

Factoring puts more weight on the credit position of your customers than that of your business. As long as you are invoicing credit-worthy businesses and/or government entities, accounts receivable financing is an appropriate and attractive option, available even to those businesses facing excessive debt or bankruptcy.

Once your client has been approved, you control the frequency and amount of funding by the invoices you present. No further approvals are necessary. No loan committees are consulted to see if your credit line can be increased. You make the decisions. In some cases, we even have programs for financing consumer receivables.

Star Financial Resources offers three accounts receivable funding products:

Commercial accounts receivable funding is for businesses who sell to other businesses or government entities (but not consumer/retail). This is the most common accounts receivable funding program.

Medical accounts receivable funding (also known as medical receivables factoring) is a specialized program in which the insurance companies - rather than the patients - are the "customers" by whom the invoices will be paid. Funding is based on the anticipated reimbursement from the insurance company.

Construction accounts receivable funding is available to subcontractors who invoice general contractors for portions of a construction project. The general contractor must have good credit and confirm that the work represented by the invoice has been completed and is acceptable before funds can be released.

Client Evaluations – Improving Cash Flow

More customers usually mean more cash flow, but clients who can't or won't pay on time are bad for your bottom line. Wouldn't you like to know up front which prospects present the least financial risk? Part of the Accounts Receivable/Factoring process is to evaluate your potential client's intent and ability to pay, and guide you in choosing your customers wisely.