Is your business reliant on the oil boom in the US? Chances are, you’ll have to wait anywhere from 30 to 90 days to get paid on your invoices. This can greatly impact your business’s cash flow enough to halt daily operations.
Understanding Oil & Gas Invoice Factoring
Does your business specialize in excavating, tubing, ditch digging, drilling, swabbing, hot oil, fracking, or hauling? No matter what services your business offers, oil and gas invoice factoring can help your business get paid faster for its hard work.
Although you may invoice your clients on a regular basis, your business often suffers from clients that do not complete their invoice in a timely fashion. When this happens to your business, you may think that the only answer is to turn to a bank or lending service for cash. This is not the case. With invoice factoring, your business will be able to hire crew, invest in equipment and cover day-to-day expenses to grow your business without incurring debt or extending his credit.
With invoice factoring, your business can get paid faster. An invoice factoring company will and advance you up to 96% with low rates on your outstanding invoices. This will happen in just as little as 24 hours or less.
The percentage of how much of your invoice will be advanced is determined by the credibility of the client that holds the invoice with your business. The invoice factoring company will run a credit check on your client to determine how likely they are to complete their payment and, in return, advance your business funds accordingly.
Benefits of Using Oil & Gas Invoice Factoring
This is a great benefit for oil and gas businesses. As business is constantly fluctuating, you need a strong source of working capital. By utilizing oil and gas factoring, your business will be able to get paid instantly for its work and will have the opportunity to build a strong source of capital. This capital can be used for:
- Expanding clientele
- Stocking up on inventory
- Growing your staff
- Marketing to new markets
- Purchase new equipment
- Repair existing equipment
These are just a few of the many benefits that oil and gas factoring can bring your business. When your business utilizes oil and gas factoring it will have the opportunity to grow larger than ever before.
Non-Recourse Oil and Gas Invoice Factoring
If your oil and gas company is looking for a 100% risk free form of financing, consider non-recourse oil and gas factoring. With non-recourse oil and gas factoring, your business will get an advance up to 96% for your outstanding invoices with low rates in just 24 hours or less, but without the risk of repayment.
Because the invoice factoring company purchases your invoices, they take on the task of collecting payment from your clients. With traditional oil and gas factoring, your business would be responsible to pay back the factoring company if the customer doesn’t pay. With non-recourse oil and gas factoring, your business will not be held accountable for repayment.
This is a major benefit to all oil and gas businesses. Not only will you be able to get instant access to the money owed to your business, but also have no risk of having to give it back.