Frequently Asked Questions

You can read answers to the most frequently asked questions about Growth Capital and factoring below.

Who needs factoring?

Companies and entrepreneurs that are growth-oriented, young, may not qualify for bank loans, are dealing with tax problems, or need help with their balance sheets can benefit from Growth Capital’s factoring service.

How do I get started?

The approval process is fast at Growth Capital. You can expect a response within one or two business days after submitting your paperwork. We makes decisions quickly without outside interference. As soon as you are approved, you can typically receive funding on your first invoices that same day.

Do I have to factor all my invoices?

No, you are free to factor as many invoices as you desire within the framework of your factoring agreement. You can pick and choose which invoices you would like to factor with Growth Capital.

What happens if you receive payments for an invoice I did not factor?

If we receive a payment for an invoice that was not factored, we give you your money back without a fee, subject to terms in our service agreement.

Am I eligible to factor if a PPSA is filed against my company?

Factoring companies are often able to fund against your existing accounts receivable, even if a PPSA (Personal Property Security Act) notice is filed before ours. Often, we can obtain a subordination agreement from other lien holders. In many cases, Growth Capital can get consent from your lender or bank that will allow you to factor your accounts receivable with Growth Capital. In short, we often do the work for you!

How will factoring affect my relationship with my customers?

Growth Capital has a positive impact on your customer relations. We often eliminate potential disputes by confirming that goods and services have been received and rendered to the satisfaction of your customers. Also, when your customers know you are working with a factoring company, they know you will complete your work because you will have the required working capital to do so. This also enables them to take on more jobs with you as needed.

How do you calculate the factoring fee?

The fee is based not on the strength of your company but rather on the quality of your accounts. Therefore, the cost is generally based on the credit worthiness and performance of your account receivables. When compared to both the cost of maintaining receivables for 30 days or more and the administrative expenses associated with collections, factoring is an efficient and valuable business strategy. Factoring with Growth Capital in itself often allows many of our clients to offset the factoring fee and work with us at a minimal cost.

Is Growth Capital a lender?

We are not like a bank. We do not lend you money that you must pay back. Instead, we pay you for work you have completed. Unlike a bank, Growth Capital’s factoring service allows you to get paid what you are owed, right away. You do not have to wait on your customers to pay, and you do not incur debt like you would with loans from a bank.

Is there a limit on how much I can factor?

No, there is no limit on how much you can factor. How much money Growth Capital will make available to you is limited only by your customers’ financial strength and payment performance.

How long does it take to get funded?

The approval process is fast at Growth Capital. You can expect a response within one or two business days after submitting your paperwork. We make decisions quickly, without outside interference. As soon as you are approved, you can typically receive funding on your first invoices that same day.

What happens if I sell you an invoice that my customer fails to pay?

If your customer fails to pay a factored invoice within 90 days, you will be responsible for “repurchasing” the invoice, unless it was approved to be purchased on a “non-recourse” basis.

How will my customers know to remit payments to you?

Your customers will receive a Notice of Assignment letter from Growth Capital, which instructs them to remit payments on your account to Growth Capital. The letter will include the addresses and banking information they will need for sending payments to ensure convenience. We also require your invoice to contain our remittance address and/or wire instructions.

Is there a minimum accounts receivable amount to qualify for factoring?

No. If your company sells a product or provides a service to another business, Growth Capital will have a program to fit your individual needs.

Who is responsible for collections?

We encourage our clients to participate in the collection process. However, in order to reduce the time and cost typically associated with collections, most of our clients prefer to have us monitor and pursue collections independently.

Isn't factoring only used as a last resort?

Not at all. In fact, countless thriving companies use factoring as a service to access the funds that have been locked in their accounts receivable, allowing them to grow and take on even more work. The benefits of upfront payment on invoices appeal to many successful business owners, not just to those with financial challenges.