As a business owner, you know cash is king. It finances your payroll, enables expansion and keeps you afloat during unexpected events or downturns. There are any number of ways that you can fund your business, be it through a bank loan, line of credit, private investment or otherwise. As far as bank loans or lines of credit, unless you meet their requirements, you might not even qualify. If you do, the rates and fees might be exorbitantly high. This can create problems for your business as you begin to examine your own financial obligations. This is where financing alternatives can come into play.
Alternative finance solutions have been part of the business landscape for years, but it’s in recent days they have been moving online. In the U.S. alone, the online alternative finance market reached $34.5 billion in 2016, a 22 percent jump over just one-year prior. The alternative finance market features options, as it’s not one size fits all. There are “buyer-centric” solutions, while others could be considered “supplier-centric” services. In each case, they allow business owners a way to get the money they need to fund their business in exchange for a fee. In the end, it helps business owners, especially SMEs who often face challenges in securing credit, to get the cash infusion they need when they need it.
The benefits of alternative finance extend beyond simply getting the cash in hand. If you as a business owner know when and exactly how much you’re going to get paid, you can better manage your finances as a whole. You can smooth out your income stream rather than face peaks and valleys, enabling you to focus on growing your business and looking toward the future.
Accounts receivable financing
As you consider early payment of your invoices, examine the overall costs of the various services. While one might seem like an inexpensive proposition with low rates, there might be fees hidden in the fine print that you’ll only find out about down the road.
Early payment of your invoices can be a lifesaver for your business. It can carry you through rough patches or give you the cash infusion you need when you need it. Just make sure to do your homework and select the provider that works best for you.