Who Needs Receivable Financing?

Companies with unique situations
Many otherwise well performing businesses are unable to access traditional bank financing due to unique or historical circumstances. This would include those with:

    Pending or Imminent Ownership / Structure Changes
    Young, Unknown or Volatile Industry Involvement
    The Desire to avoid long term debt
    Positive but Irregular Cash Flow
    Over Accelerated Growth

Companies with stressed financial conditions
One of the most common reasons for business credit to be denied is the financial condition of the applicant.

While all lenders seek to be repaid, the following companies may find commercial banks less likely than finance companies to take on greater risk for potentially greater reward:

    Companies That Can't Demonstrate Sustained Profitability
    Insufficient or Sub Bankable Net Worth
    Historical Liens / Losses / Filings / Judgments
    Derogatory Corporate / Personal Credit

Companies with inadequate existing credit lines
Businesses who have been successful in establishing bank financing frequently have cash requirements beyond that which is available through existing bank lines. The following are some examples:

    Routinely Inadequate Bank Lines
    Bank lines requiring Compensating Cash Balances
    Bank lines with annual clean-up requirements
    Bank financed businesses with limited trade credit


Time in business
Often business credit is denied by commercial banks due to stringent time-in-business requirements. Businesses such as the following may still be able to obtain financing through receivable lenders:

    Start Up Companies
    Companies Less Than 2 Years In Business
    Established Companies With Recent Ownership Changes
    Newly Incorporated Businesses
    Established Businesses New To The State
    Inadequate Track Record