Invoice factoring is an affordable and efficient way to get paid on time when you need steady cash flow. But did you know that invoice factoring can also affect your credit score?

For companies in the trucking/transportation, oil & gas, manufacturing, and service industries (as well as other industries), cash flow can be a problem when you’re depending on timely payment from your customers.

Invoice factoring can provide you with the cash you need, when you need it – and also boost your credit score.

How Invoice Factoring Impacts Credit

Credit can be a complicated thing. But at the end of the day, protecting your credit from dropping depends on proving to creditors and rating agencies that your business can handle fiscal responsibilities.

Whenever you miss a payment on a bill or a loan, your credit drops. This usually happens thanks to cash flow problems. When your customers don’t pay on time, and you’re strapped for cash, you can fail to make timely payments – thus your credit gets dinged for it.

Fortunately, invoice factoring can help circumvent that in two ways. For starters, you don’t have to take out loans. Additionally, you don’t have to miss payments because you have the cash on hand to make them.

Factoring can also help with credibility for your vendors. One of the most pressing issues a business in the above industries runs into is being unable to access vital supplies when you need them because you’ve hurt your credibility and trust with your vendors through missed or late payments.

Invoice factoring can help ensure you have a steady stream of what you need to get the job done, thanks to ensuring steady cash flow into your business that can be used to pay vendors on time. The more dependable your business is to your vendors, the more willing they’ll be to work with you.

Choosing an Invoice Factoring Partner

Not all invoice factoring is created equal, though.

You want a partner who is trustworthy, quick with the cash, and flexible. You need customized solutions specific to your needs, not just those of a typical industry member. Your repair shop or trucking company is different from the rest, so you need a different financial solution.

Talk to our team at Corporate Billing to learn more about invoice factoring and the numerous benefits it can offer not just for your credit, but for your peace of mind.