For those trying to run an oilfield service company, there will be many points along your journey where you will have to address cash flow problems. At Oilfield Factoring, we have funded hundreds of millions of dollars in invoices for our clients. From water haulers to frac sand trucks, pipe welders to roustabouts, we understand the in’s and out’s of the oilfield industry. That’s why we’d like to provide you with the following information about oilfield invoice factoring compared to traditional bank loans.
Oilfield Invoice Factoring Is A Faster Solution
Getting a loan from a bank can take anywhere from weeks to months and that is only after jumping through a variety of loops to secure one. Even worse, the amount you are likely to get is often far less than what you actually need. Time and funding amounts like this are detrimental to any business, no matter the industry. Most companies simply don’t have the time it takes to wait 90+ days before receiving the cash they need to make payroll, manage equipment, and take on new opportunities for growth.
Oilfield invoice factoring provides companies with essential cash flow within 24-48 hours of an invoice being verified. In fact, most factoring companies will pay up to 90% of an invoice amount while keeping the remainder in reserve until a customer pays.
Another factor that makes oilfield invoice factoring a better choice over bank loans is that a bank will look at your credit history before deciding whether or not you get the money you need. An oilfield invoice factoring company, on the other hand, looks at the creditworthiness of your customers before placing a value on your invoice. This allows you to get the money you need from a factoring company even if your credit history isn’t the best.
The ease and convenience you get with oilfield invoice factoring means you will always get paid for your work and you will always have cash flow when you need it.
Oilfield Invoice Factoring Makes It Easier to Manage Your Credit Score
Owing debt is a part of any business. From startup to maturity, it’s more than likely you will have to take out a loan at some point in order to make ends meet. With invoice factoring, however, you can secure steady cash flow for your business as you work out the details of increasing your credit score. The more cash flow you can secure, the easier it will be to remain debt free until you are able to approach banks at the right time.
Oilfield Invoice Factoring Isn’t A Loan
Oilfield invoice factoring isn’t a loan and can be secured even if you don’t have a perfect credit score. Even more, there are a variety of different types of invoice factoring from which you can choose from. For example, non-recourse invoice factoring is a risk-free form of factoring that puts the majority of the risk on the factoring company.
Non-recourse factoring, on the other hand, allows you to obtain an advance for your invoice while the factoring company bears the full risk of your customer not paying their invoice due to insolvency. This allows you to get the cash flow you need without having to worry about owing that amount to another company in the event a customer goes out of business.
Get Started With Oilfield Factoring
If your company is in need of money it’s important to think of all the benefits oilfield invoice factoring provides compared to traditional bank loans. At Oilfield Factoring, we promise to help your business overcome the challenges you face in order to grow and succeed. If you would like more information or want to get started today, contact us at 1.866.834.7338. We look forward to helping your business run smoothly to succeed in any environment.
