Factoring

Factoring:

Factoring is a transaction in which a business sells its accounts receivable, or invoices, to a third party commercial financial company, also known as a “factor.” This is done so that the business can receive cash more quickly

Meridian Finance has set up a business growing product for your working capital solution- “Factoring of Accounts Receivable”, if your business stuck on credit with institutional buyers

Cash flow is essential to the success of each business. As a business grows and needs to speed up cash flow, small businesses typically first turn to banks for financing. However, with tough credit standards banks cannot always fully accommodate a company’s financing needs. Alternative financing options, such as accounts receivable factoring from MFIL, may provide the working capital to the business needs

Eligibility

  • Make supply of goods/raw-materials or provide service to institutional buyers/customers on a regular/continuous basis
  • Have multiple institutional buyers/customers
  • Monthly business turnover minimum BDT1.00 million.
  • Subject to clean CIB report from Bangladesh Bank

Services Offered:

Invoice Processing – MFIL Funding handles invoice processing, including posting invoices to a computer, depositing checks, entering payments, and producing regular reports

Follow-up and Physical Collections Services – MFIL Funding handles Follow up collections in a professional and productive manner, allowing your staff to focus on high value-added activities. We also ensure physical collection of payment from Buyers located in different geographic locations

Reporting: MFIL will provide reports in detail which shows the business status and helping decision making by the management of the Clients/Suppliers

Benefits from Factoring:

Immediate Cash – We advance cash on your qualified receivables in less than 24 hours

Collateral Free Financing – You do not need to provide extra collateral for availing Factoring Facility from MFIL. You will sell only your current and future receivables to MFIL

Eliminate Overhead – You greatly reduce your current overhead cost associated with processing invoices and you eliminate the overhead cost of handling collections

Offer Credit Terms To Customers – You can offer credit terms to your customers to increase your sales without negatively impacting your cash flow

Unlimited Capital – Factoring is the only source of business financing that grows with your sales. As sales increase, more money becomes immediately available to you

Leverage Off Of Your Customers’ Credit – You don’t need good credit or a long-term operating history for factoring services; all you need is creditworthy customers

Factoring Helps Build Your Credit – Once you begin factoring and have adequate cash flow, you’ll be able to pay your vendors on time and establish a good credit rating that will let you get credit from other vendors and other financial institutions

Factoring Is Quick And Easy – The application is simple and fast to fill out

Required Documents:

  • Valid Trade License
  • TIN Certificate
  • Updated asset report / updated stock/Inventory report
  • Bank Statement for last 1year
  • Sales data for at least 1 year
  • Copy of Utility bill
  • Rental deed copy
  • Land Documents (if applicable)