Debtor Finance (Factoring)

Debtor Finance offers small to medium sized enterprises the opportunity to accelerate their cash flow or provide extra cash during peak seasons. This allows the maximization of business opportunities by providing a flexible Line of Credit linked to the level of your debtor's ledger.

The process is simple:

• An agreement is signed with the financier who will provide an initial cash injection of up to 80% of your debtors' ledger into your business.
• When you have raised an invoice for goods you have delivered, or services you have provided, you will receive up to 80% of the value of that invoice usually within 24 hours.
• You are then refunded the remaining 20% when your client pays. In effect, it's as if all your customers had paid in cash!

Debtor Finance is increasingly replacing less flexible options like the overdrafts, as the facility does not require the director's homes to be mortgaged like a bank. The facility is secured primarily by the assets of the business.

Why consider Debtor Finance? Debtor Finance is suited to businesses that require additional working capital for specific reasons, e.g.

Funding Growth - the facility is generally limited only to the level of your accounts receivable. As your business grows, so does your Line of Credit. This gives you the flexibility and confidence to grow your business in the knowledge that you have an increasing working capital facility, without the need to continually approach your Bank Manager.

No Real Estate Security - facility is secured primarily by a Registered Mortgage Debenture over the assets of the business and guarantees from the principal directors and shareholders.

GST - if tax commitments are straining your cash flow, Debtor Finance may just be the solution.

Outsource Debtor Administration - facilities are available if you wish to outsource your debtor administration to industry specialists, and save considerable costs.

Start Ups - Debtor Finance is an ideal facility to assist those businesses in their infancy.

Obtain Supplier Discounts - the additional cash generated will enable you to negotiate discounts with your suppliers.

Settlement Discounts - by gaining access to 80% of invoices immediately, you can avoid offering expensive settlement discounts to your customers.

If you would like to learn more about debtor finance contact CD today!