InsideUp Factoring Sourcing Blog

Tips on Finding and Managing Factoring Services.


Recourse vs. Non-Recourse Business Accounts Receivable Factoring

Apr 4, 2013

By:  Arlette Measures

Factoring is a type of transaction where a business sells their accounts receivable to someone else (a Factor) at a discount. It is often used by businesses with lots of receivables in order to obtain cash quickly and provide the company with the capital that it needs. There are two general types of business accounts receivable factoring, recourse and non-recourse, which work slightly different from each other.

 

Recourse factoring is an agreement where you and your business are responsible for buying the receivable back from the business accounts receivable factoring company if the amount owed is not paid for by your client after a certain amount of time. The amount of time is pre-determined on the contract, and is usually between sixty and ninety days. It is important to remember that clients may not pay you back for a number of reasons, including bankruptcy or lack of capital, which makes this a riskier transaction for you. This type of factoring is more prevalent and usually less expensive since the company buying the receivable is still sharing the risks associated with the transaction.

 

Non-recourse factoring is a type of transaction where the party buying the receivables assumes total responsibility for them. This means that the company selling the receivables completely transfers responsibility for them once the transaction is completed. You and your company are no longer responsible for buying the receivable back if it is not paid in time by your debtors. This kind of transaction is less common and understandably more expensive, as the company purchasing the receivable assumes a much greater risk.

 

When looking for business accounts receivable factoring, it is important to carefully evaluate the advantages and disadvantages of each option. Whether recourse or non-recourse factoring is the best option for your company is ultimately up to you to decide. Be sure to do your research and evaluate what the best option is for you.

 



Factoring On The Go With The New VendorFind App

Mar 22, 2013

By:  Arlette Measures

Factoring is a term used in the business world that allows business owners to sell accounts receivable aspects at a lower rate to another party that funds the company and helps them raise capital. It is an old, but one of the most reliable forms of business financing. Factoring is more common in some industries such as the clothing field because the receivables have a business cycle that lends itself to this type of loan. However, with modern technology at everyone’s fingertips, factoring has even become something that can be aided by the new apps.

The new VendorFind App can help corporations find businesses that want to help them with their funding through factoring. The app also allows companies to have access to high quality factoring companies that charge low costs. This can greatly aid any business move forward in a positive manner. The cost-effective app connects businesses to services they need on a regular basis.

The new VendorFind app features 20 different service provider categories such as payroll services, web development, cash advance services, internet options, human resources and many others. When you search for a specific type of business, you will receive a large amount of information about not only how to choose a specific provider, but also what providers are on the market. You will have access to informational videos, vendor ratings, and quick guides that give you overviews of the category you have chosen.

After you find the service you need, you can submit a survey and match yourself to vendors that fit what you need. You will get custom quotes from each of the vendors that meets your requirements, then you can then call the vendors yourself to ask further questions or make the hire.

Finding qualified services for your business has never been as simple as it is today with modern technology on your side including the new VendorFind app.