Factoring is a straightforward process. Usually, oilfield service companies wait more than 60 days to get payments from the customer. In which, oilfield factoring is a financial solution for service contractors and suppliers in need
Factoring is a straightforward process. Usually, oilfield service companies wait more than 60 days to get payments from the customer. In which, oilfield factoring is a financial solution for service contractors and suppliers in need of immediate cash. The factoring helps the oilfield companies with consistent cash flow enabling the companies to meet payroll, manage their business, and grow their business. The factoring company advances the client a percentage of the value on the same day.Invoice factoring provides the steady working capital that one need for every step of an organization.The top benefits of invoice factoring for oilfield service providers are given below.
Easy set-up process:
It can take even month to complete the paperwork to get approved for financing from the traditional lenders. With most factoring companies, you get the cash when it’s needed. You can submit the invoice, and receive the cash on that same day. It is essential to work with the factor who understands your business and know ins and outs of your industry. So, they will come with flexible cash flow solutions.
Rather than waiting for 30 or 60 days, factoring companies allows your business to receive payment for its services almost immediately. Once approved, you could receive the amount on the account in as little as 24 hours. The factoring companies have a team of expertise in providing cash flow solutions to the oil and gas companies. When you get the funds immediately, you can process the work without any delay. It helps the business to grow consistently. Having a source of consistent cash flow is a key element to long-term success.
No debt risks:
One of the significant benefits of oilfield factoring is that is not a loan. You need not assume it as any debt if you choose to factor your accounts receivables. It is the best way to run your business debt-free. The factoring companies are buying your invoices and providing cash that your business has already earned, and is waiting to be paid. Another advantage about factoring is that even you have a low credit you gets qualified for financing. You could secure the capital you need and can start rebuilding your credit.
Especially in the oilfield industry, maintain sufficient flow cash is a must for paying bills on time, investing in new equipment, transportation and many others. The simple set-up and quick process to cash have made the oilfield companies think factoring is the ideal option.