Many entrepreneurs complain about impediments they encounter in their way while running their business in our country. Apart from the obstacles created by various offices, it is not easy to raise funds for current activity from banks in worse economic conditions. What are the alternatives?
One of them to consider for those who offer deferred periods of payment for their customers is factoring, which may constitute an alternative for credits. Apart from banks, such service is offered by factoring companies, who offer attractive terms for SMEs sector. Flexible approach shown by non-banking factors mainly involve the assessment of company’s capabilities, not only of the basis of its financial results, but – first of all – on the basis of its customers’ financial standing. A factoring company approaches the issue of creditworthiness much more favourably, focusing on the analysis of potential factorer’s customers’ solvency. Apart from that, small companies that generate annual turnover below several hundred of PLN may make use of factoring services.
What is more, non-banking sector may also be interested in financing debt portfolios of low values or even single invoices. Receivables may be even slightly overdue, then a given transactions is linked to a debt collecting service, A factoring company’s flexibility means the possibility to offer complex receivables management services and offering additional services, which may suddenly be necessary to use. These may involve, for example short-term loans or discounted bills of exchange.
On the Polish market we can find factoring companies which offer services intended for the needs of the SMEs sector. While understanding the specificity of the operation of this group of companies and their specific needs, financial tools are constructed in the way that corresponds to market reality Polish entrepreneurs must combat.
Published on: 14 November 2016