In our invoice financing series, you’ve learned about invoice financing, the pros and cons of invoice financing, and what you need to pay attention to when selecting a company to work with for your business. Now we’re going to cover how to apply for invoice financing.
What companies are a good fit for invoice financing?
Invoice financing is best for companies that have a business-to-business (B2B) model and have outstanding receivables. While it does work for some business-to-consumer (B2C) companies, the key is that there are outstanding receivables, which lends itself more to B2B companies.
Invoice financing is best for companies that have a B2B business model and have outstanding receivables.
Who qualifies for invoice financing?
There are two different kinds of invoice financing companies.
The first type of company that offers invoice financing bases their decision on your business. They will review your revenue, profitability, time in business, the owners’ credit scores, and more.
The second type of invoice financing company bases your qualification on your customers and their credit. This means that while they review your company and require some documents from you, the deciding factor of your application is based on your customers and their ability to pay the invoices. The maximum amount you can qualify for, and your fee is based on your payment terms, amount of invoices and your customer’s creditworthiness.
The average Raistone customers who were approved had:
- More than $1M in annual revenue
- Three Years in business
- Unpaid invoices
- Clients using online invoice systems
- Recently received extended payment terms from their customers
How do you apply for invoice financing?
For most companies, applying for invoice financing is a simple, streamlined process. At Raistone Capital, the amount you qualify for and the terms of financing are based on your revenue, your customer’s credit worthiness, and your payment terms. Those three factors are the most important part of the application process.
That said, many invoice financing companies review your business financials as well.
Some companies, like Raistone, are even integrated with your customers’ eProcurement/invoicing platform (e.g. Ariba, Bamboo Rose, Coupa, etc.). This allows for a direct feed of your invoices on the invoiceXcel platform, so you can easily view from one up to all of the invoices that you would like financed. You don’t need to worry about manually uploading invoices or any work on your part to finance the invoice. Just select the invoices that you want to accelerate with the click of a button.
Ready to Apply for Invoice Financing?
It’s recommended to have a few key documents handy, such as articles of incorporation and a sample invoice.
If you want to learn more about invoice financing and if it’s right for your business, contact our team at any time.