Partial Funding Of Invoice
Since factoring is all about generating predictable cash flow for the client, it sometimes happens that the client wants to control the amount of cash flowing in. For example, a client may have factored a large invoice, but the present cash flow needs of the business are sufficient.
In order to save the client from paying unnecessary factoring fees on the full amount of the invoice, a factoring company may agree to partially fund that invoice for an amount set by the client. Factoring fees will be paid on the partial amount only.
Once the full amount of the invoice is paid by the debtor, the factoring company will keep the advance and its fees, calculated on the partial amount, and remit the unfactored amount to the client.
© 2007 Sanjeev Aaron Williams & Cashwerks All Rights Reserved
Since factoring is all about generating predictable cash flow for the client, it sometimes happens that the client wants to control the amount of cash flowing in. For example, a client may have factored a large invoice, but the present cash flow needs of the business are sufficient.
In order to save the client from paying unnecessary factoring fees on the full amount of the invoice, a factoring company may agree to partially fund that invoice for an amount set by the client. Factoring fees will be paid on the partial amount only.
Once the full amount of the invoice is paid by the debtor, the factoring company will keep the advance and its fees, calculated on the partial amount, and remit the unfactored amount to the client.
© 2007 Sanjeev Aaron Williams & Cashwerks All Rights Reserved
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