Factor Your Government Receivables to Grow Your Business
Landing a government contract is an excellent opportunity for any business. Even when problems arise and there is a government shutdown, government contracts always pay their companies. However, taking on a government project could quickly drain your working capital while you wait 30, 45, 60+ days for the government agency to pay. Invoice factoring for government contracts closes the cash flow gap contractors face between project completion and payment. With receivables factoring, business owners get paid upfront to ensure they have the funds necessary to cover all operational costs and payroll.
Bid on Contracts with Confidence
It’s true that businesses with the ability to extend credit terms often win the best contracts. By factoring government receivables, you’ll always have a steady source of working capital to accept new government contracts, cover
payroll and operational costs, and take on additional projects while extending more generous payment terms. Don’t bypass opportunities. Invoice financing for government contractors and suppliers is the working capital
solution you’ve been waiting for.
How Does Government Contract Factoring Work?
A large government contract has the potential to dry-up your cash flow and make it difficult to float other projects that may arise or complete the project you took on. Whether you’re working on a project for FEMA, the Department
of Transportation, or your local school district, factoring can get you the funds you need.Factoring government receivables is straightforward. It’s a debt-free alternative funding method that involves selling your government
invoices to a factoring company.First, you have to find the best government factoring company for your business. This is what we do for you by using our industry expertise and learning about your company’s needs.You will go
through a simple application process and then you can start factoring. Once the invoice is submitted, the factoring company you’re partnered with verifies the invoice and advances contractors the cash within one day.Advances
can be between 80%-90% and the remainder is held in a reserve account. Then, the factoring company collects payment from the government agency. Once the invoice is paid, the factor releases the remaining portion in reserve
back to the contractor, minus a small fee for the receivables factoring service.The advance given from the factoring company is what you’ll be able to use to complete the project, continue running day-to-day operations and
covering payroll, for example. Factoring government contracts is simply getting your money faster.