Invoice Financing vs Bank Financing

Lisa Hultz

Lisa Hultz

Lisa is the President of Sales & Marketing for Mazon Associates, one of the oldest factoring companies in Dallas, Texas.

Invoice financing is often misunderstood as being an expensive method of financing when compared to traditional bank financing. Actually, that’s not true. When you compare the fee factors charge versus the interest rate banks charge, factoring appears to cost more.

Financing Your Small Business with Invoice Financing

Factoring companies provide services such as accounting, credit services and receivables collections. Banks don’t offer these services for small businesses. Here are many more differences between invoice factoring and bank financing:

 Invoice Financing Bank Financing
Cash flow statements Not Required Required
Complete financial statements Not Required Required
Income tax records Not Required Required
Proven financial track record Not Required Required
Future financial plan Not Required Required
Excellent personal credit Not Required Required
Federally regulated No Yes
Collateral Receivables
All assets
Borrowing amount Determined by sales
Limited to bank terms
Loan covenants or restrictions No Yes
Perform receivable collections Yes No
Perform credit services Yes No
Application approval process 3-5 business days 1-2 months
Cash availability Instantly upon approval 1-2 months

Bank loans are very difficult for small businesses to obtain these days. Not only are banks so heavily regulated by the federal government, but bank qualifications for a loan far exceed those for a factoring agreement.

Banks primarily focus on the credit of the borrowing business and its owners, while factoring companies focus on the credit worthiness of the business’ customers. A business can qualify for invoice financing within days. A bank loan approval can take months. With factoring, cash is available much quicker.

Mazon Associates

Mazon Associates is a Dallas factoring company that has over 40 years experience in the invoice financing industry. Mazon provides friendly, responsive and professional factoring services and they help your  business improve its cash flow. Call Lisa Hultz at 800-442-2740 to discuss your factoring needs.

Mazon Associates, Inc. has been providing factoring services for more than 40 years. We’ve helped thousands of clients grow their businesses and achieve their financial goals. We consistently provide a first-class experience in accounts receivable financing. You can depend on Mazon for your cash flow needs.

Call us today at (972) 554-6967!

Mazon Associates Factoring

The most flexible terms in the industry.

No Startup Fees

We don't charge application or startup fees, so you can start factoring invoices with no out-of-pocket fees.

30-Day Cancellation

Our contract terms are month-to-month, so you can cancel at anytime with only a 30-day cancellation notice.​

No minimums

We don't charge monthly minimum fees, so you don't get charged when you don't factor invoices.

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