Invoice discounting is the method of utilizing a company's unpaid invoices as collateral for the loan that is issued by a financial company. It is one of the instant and easiest ways of getting the loan by a company to run its business activities such as stocking up inventory, paying wages, buying new machinery, etc. The invoice discounting marketplace in India is growing up to a large extent. Businesses find it easy as they get quick cash inflow to run their business activities and do not wait for long as they need to do while getting loans from banks. Though the amount issued as a loan by the finance company is around ninety percent of the total amount of invoices, the issuance is done on a faster basis. Invoice Discounting Benefits for Businesses It is an invoice finance facility that is availed by the businesses and allows businesses to get benefit from the value of their sales ledger. For certain types of businesses, invoice discounting brings a large number of benefits. They can increase their cash flow at a low-security cost, they need to follow a transparent and simple security structure and they can avail invoice discounting whenever there is a need without any obligation. The customers can directly pay their invoice bills to the finance company without even knowing that they are paying their bill against an invoice loan. Here are mentioned some benefits of invoice discounting. Read More: Invoice Discounting: Advantages and Disadvantages
Benefits of invoice discounting - Infographics
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If you are convinced about the benefits of invoice finance and have finally determined that it can boost your operations, here are some things you should know about unsecured supply chain finance before you start looking for an invoice finance company. Supply Chain Finance Charges While every invoice discounting firm will tell you that they have the lowest factoring charges, it isn't essentially true. Many SME owners have been left baffled by additional fees and penalties which were a part of the fine print and which they missed. These charges can drive up the cost of unsecured supply chain finance quite significantly. So, before you sign the contract, here are some things you should check with the lender.
Read More: Best Unsecured Supply Chain Finance for Start-ups A clear overview of these charges and fees will help you calculate the actual cost of your unsecured business loan through supply chain finance. Age of the Financial Institution Another thing to check for, is the experience of the invoice financing company. As FinTech is an emerging industry, it is possible that your invoice finance company is not be as old as a traditional bank. But the experience of the people in-charge at the company, counts. Look up the top-management of the invoice finance company on LinkedIn or other professional networking platforms. You can gain insights into their work and experience through their profile and portfolio to make a final decision. Read More: What is Unsecured Invoice Financing? Value Added Services on Offer An invoice finance company will offer additional services along with their primary financing service. For example, an invoice discounting company can also offer to help you with collection efforts for overdue invoices at an extra cost. Here are some of the value-added services normally offered by invoice discounting companies.
Customer Service The level of customer engagement is an important aspect of every financial service. Since the lender will be handling your customer’s invoices and you yourself are a customer of the invoice finance company, it is important that they have a responsive customer service team. Here's what to check for.
Goodwill and Integrity Everything aside, it also matters what the actual word on the street is when it comes to selecting the right supply chain finance company. So, check for that too among fellow businessmen. These pointers will help you in making the right choice and partnering with a supply chain finance company that works for your benefit. So, don't make haste and plan for a long-term and healthy financial partnership. If you are looking for a credible supply chain finance company in India, look us up at www.livfin.com. 5/13/2019 What are the Benefits of Business Loan Options Available for Women Entrepreneurs?Read NowBusiness loans are quite essential for business for expansion. Almost all businesses apply for business loan at some point in their business. If you are a dynamic entrepreneur who wants to turn their business into a reality, if you are trying to expand your business to a state, national or international level, applying for a business loan is extremely important. There are several sources from where you can get the loan for your business. In the current economic scenario, small and medium-sized are in constant need of cash flow which they get it fulfilled by acquiring a loan from different sources.
Benefits of Business Loan Options Available for Women Entrepreneurs Getting business loans helps in fulfilling the constant need of funds to expand the business. They help in meeting the working capital needs and also in making sufficient use of rising business opportunities. When there are many loan options available for business start-ups, women entrepreneurs are still in a distinct minority. To push the growth of women entrepreneurs further, the option of business loans for women can be a big initiative among women. Nationalized banks and many other financial institutions have introduced many schemes that help in fulfilling the needs of the minority sector. There are many benefits to get women business loans.
Cent Kalyani from Central Bank of India, Stree Shaki from SBI, Shringaar, and Annapurna from Bhartiya Mahila bank, etc are some institutions that offer business loans for women. Read More: How Government Aids Financial Support to Women Entrepreneurs in India |