The 2008 financial crisis caused banks to tighten restrictions on small business loans. They focused on larger loans as they are more profitable. With the economic downturn that resulted from the COVID pandemic, traditional business financing is harder to secure than ever. Grant programs such as the PPP (Payroll Protection Program) and EIDL(Economic Injury Disaster Loan) have dried up. Business owners that are still struggling to recover are looking for alternative funding options to keep their businesses afloat. However, this is not the only reason business financing alternatives are becoming more popular with business owners. They offer benefits beyond funding.
One of the biggest frustrations of traditional business financing is how long it takes to get a loan. Certain steps must be taken before the bank will even accept the application. Then once it is submitted, approval can take anywhere from a couple of days to months. That can be too long to wait for businesses that need funding fast.
Business finance alternatives typically require less information than banks, making the application and approval processes much quicker. Businesses can often have the funds they need within days, allowing them to spend less time searching for financing and more time on taking care of business.
Even if you have all the proper documentation prepared when applying for a traditional loan, certain industries have been “black listed” by banks insured by the FDIC (Federal Deposit Insurance Corporation). The reason is that those businesses are considered high risk and the FDIC won’t insure banks that issue high-risk loans.
Businesses that work with alternative lenders often find more success when looking for business financing. Business owners should do their research and weigh their options. If your business is typically turned away by banks, don’t waste valuable time jumping through their hoops. Instead, consider the business finance alternatives.
Unless you’ve been dealing with the same bank forever, most of them will just take your mounds of paperwork and follow a standard checklist to see if you qualify for financing. Alternative lenders focus on understanding your business and building a relationship. This may not seem all that important at first but think about it.
Many business finance alternatives provide short-term financing, something many businesses will need more than once. Establishing a relationship with an alternative lender will make the process even easier the next time you apply. With a bank loan, you have to go through the entire application process every time, and the chances of being approved are slim. Alternative lenders work hard to get your application approved for funding.
If approved for a traditional bank loan, beware. They often come with strings attached called loan covenants. These covenants place restrictions on how you can spend the funds you received. Do you want someone else telling you how to invest in your business?
With most business finance alternatives, once you have been approved and received funding, you can spend those funds how you see fit. Some options, like the merchant cash advance, include repayment amounts that fluctuate with your cash flow.
If you need immediate funding or have been denied a traditional loan, alternative financing options could be the answer to your problem. At CapFlow Funding Group, we value each of our clients and work hard to provide them with the perfect funding solution for their business. Our team works with various industries and specializes in invoice factoring and merchant cash advances. If neither of these fits your needs, we will work with trusted partners to get the funding you need. Contact us today. We’re looking forward to getting to know you.
When you’ve been in business for a little while, one thing is certain. You’ve probably had times when you wish your customers would pay their invoices sooner. Whether you want to ensure the timely payment of operating expenses or invest in new business opportunities, factoring can help make that happen. Just imagine how getting money that is owed to you before invoices are due can improve your cash flow. This would make almost every aspect of your business run smoother and reduce financial stress. The benefits of factoring services can make a big difference when it comes to building a successful company.
One of the best benefits of factoring service is getting paid for your invoices without the long wait for them to come due. It could mean immediate access to funds that can be used to pay for other expenses or even expand operations! This would allow you to spend more time and energy on taking care of business and less time trying to see how far you can stretch your working capital. Think about how much better you’ll sleep at night knowing that your cash flow is taken care of and you can move forward with confidence.
Factoring allows you to get money owed to you quickly so you cover operating expenses with ease and invest in new opportunities as they arise. Paying your bills on time or earlier will put you in a favorable position with your creditors. In addition, you will no longer be faced with passing up a big order or taking advantage of a new business opportunity. One of the many benefits of factoring services is that you can avoid putting business growth on hold while waiting for invoices to be paid.
By using factoring services, you can have a new source of cash flow that will allow you to operate more efficiently. You’ll be able to take on more contract jobs and invest in the equipment you need to provide better service overall. This means an improved bottom line for your company which will result in higher profits for your business.
Using factoring is a great way to help improve profitability because it provides access to capital without having to seek out bank loans or place large sums of money into other investments. Instead, all you need is a steady flow of invoices from clients who have a reliable payment history. Being able to avoid the lengthy application process and long-term debt associated with traditional bank loans is another one of the many benefits of factoring services.
Have you ever experienced a payroll shortage? If so, you know how serious of an issue it can be when trying to keep daily operations running. It can cause serious damage to the trust and morale of your employees. It may even cause you to lose some of your best workers. Factoring services can relieve the anxiety over meeting payroll and preserve your employees’ confidence in your company.
Once you’ve sold your unpaid invoices to a factoring service, your work is done. They will take care of collections as those invoices are now owed to them. This will cut down on accounting paperwork and let you focus on more important business matters.
Think of CapFlow Funding Group as the ultimate financial partner. Our team of experts has helped countless businesses with factoring services. We are committed to providing our clients with a quick decision on their application for funding, easy access to funds once they have been approved, and the opportunity to take advantage of all the benefits of factoring services.
Not sure factoring is right for your business? We also offer merchant cash advances and work with trusted partners to find the perfect funding solution for your business. Want to learn more about how factoring services work and how can benefit your business. Contact us today. We look forward to working with you.
