Firms in the construction industry often turn to factoring or invoice discounting to help with cashflow. Most businesses will be facing payment terms of 30-90 days and with day to day running costs this can add huge pressure for business owners to meet their working capital requirements, such as wages and purchasing materials. Construction Finance can allow a business to release funds from uncertified applications for payment, freeing up cash immediately upon issuing a valuation. Not many lenders in the factoring market are able to do this so it is imperative to speak to a specialist broker, like us at Compare Factoring, to make sure you are speaking to the right funders. This is how it works:
As well as receiving an immediate advance on uncertified applications, businesses can also benefit from outsourcing their credit control function. This is optional and can be done completely confidentially, where the factoring provider will call on behalf of your business. The construction sector is a market with one of the highest percentages of business failures. To protect your business, you can look to bolt on bad debt protection which will cover you should your customers fail. This is also known as a non-recourse facility.
