How Accounts Receivable Factoring Aids in Paying for Health Care Benefits

Research released in 2009 U.S. Public Interest Group (USPIRG) showed that 17 percent of small businesses currently do not offer health coverage due to the red tape and high costs. Successful health reform could generate some serious benefits for small businesses in the United States. The research also found out that 78% of those small businesses who don't offer health coverage would like to offer it to employees. Accounts receivable factoring for small business can convert payments on terms to COD, aiding small businesses in their endeavour to pay for health care costs for employees. here is how accounts receivable financing could help small business owners with being able to afford health care coverage for their employees.

Normally, small businesses don't get paid until 30, 60, 90 days; but if they can convert these invoices into immediate cash through invoice factoring, then these can address health care costs.

Results of the same study mentioned above also show that businesses that sacrifice in order to provide the needed health benefit think that this type of benefit is a major contributor to increased employee productivity.

Because factors do not expect to purchase 100% of a company's receivables, single invoice factoring, or accounts receivable factoring, is gaining in credits. Accounts receivable financing benefits businesses that do not get paid for 30 to 60 or 90 days by advancing up to 90 percent against invoices. The factoring company will evaluate the creditworthiness of the client's customers. When no issues arise, then funding can be given in as little time as 24 hours - plus commission fee.

Invoice factoring has really proven to be a welcome option in today's economic downturn. It's most often small businesses that experience cash flow difficulties during a recession, and several employers find it difficult to meet payroll, purchase supplies, let alone pay benefits and Workers Compensation. With this type of option, they're given access to funds that are coming in but aren't yet available.

Factoring isn't the same as a traditional bank loan. In reality, it is the buying of a company's assets - its receivables. Bank loans involve two parties, while factoring has three. Banks base their decisions on a company's creditworthiness, whereas factoring is based on the value of the company's receivables.

Most factors' professional rates are competitive since each client's circumstances vary, which may have an impact on the fees.

Accounts receivable factoring has been around for over 4,000 years. For further details, call The Interface Financial Group (IFG) at 877.210.9748.