A recent report showed that commercial lending activity fell by the biggest amount since records have been kept. This trend seems likely to get worse before it gets better because based on Federal Deposit Insurance Corporation accounting, almost one out of every ten banks is close to failing.
Existing businesses looking for immediate business financing usually turn to factoring. With factoring, a business sells its accounts receivables to another company, known as a factor. Most factors require businesses to process credit cards and to have been doing so for a certain length of time, usually three to twelve months. Once approved, the factor collects the payments on the accounts from the business's clients until the funds are repaid. Factoring is not considered a loan; therefore, no debt is incurred on the balance sheet.
Banks have far too often conducted business as if they have a monopoly on their small business financing services. The "new normal" for small business owners should increasingly reflect the growing realization that banks can be replaced when they stop providing an adequate level of service to their business customers.
Small businesses are the pillar of our modern economy. Given this, it is a bit of a surprise it is so difficult to get any financing when you are just getting up and running. Still, this is the facts of life and so most people look around for alternative financing. In some cases, that means personal credit cards.
Existing businesses looking for immediate business financing usually turn to factoring. With factoring, a business sells its accounts receivables to another company, known as a factor. Most factors require businesses to process credit cards and to have been doing so for a certain length of time, usually three to twelve months. Once approved, the factor collects the payments on the accounts from the business's clients until the funds are repaid. Factoring is not considered a loan; therefore, no debt is incurred on the balance sheet.
Banks have far too often conducted business as if they have a monopoly on their small business financing services. The "new normal" for small business owners should increasingly reflect the growing realization that banks can be replaced when they stop providing an adequate level of service to their business customers.
Small businesses are the pillar of our modern economy. Given this, it is a bit of a surprise it is so difficult to get any financing when you are just getting up and running. Still, this is the facts of life and so most people look around for alternative financing. In some cases, that means personal credit cards.
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