Bibby Financial Services has strengthened its product line with the launch of its new cash flow finance solution, Single Debtor Finance.
Single debtor finance has been developed to meet the cash flow and funding needs of small to medium sized enterprises which sell exclusively or near exclusively to a large debtors e.g. Woolworths or Harvey Norman.
It is becoming increasingly common for businesses to have to offer extended trading terms of up to 70 days to win major supply contracts.
Having a significant amount of working capital locked up in a single large debtor can put the business at risk of serious cash flow issues, hampering their ability to fulfil new large orders and provide reliable supply to the debtor, thereby putting the contract, and others, in jeopardy.
Recognising this, Bibby Financial Services offers clients a funding facility against invoices to the approved debtor up to a funding limit of $250,000.
The client transmits copies of their invoices to their major debtor to Bibby Financial Services. Then, on request, Bibby will convert up to 80% of the total value of the invoices in to cash within 24 hours, allowing the business to fund other projects.
The remaining 20% will be returned to the client once the debtor makes payment. This essentially means that businesses do not have to wait up to 70 days to be paid for completed work as they receive an advance.
“This flexible new product is an ideal way for small and medium sized businesses which supply to much larger debtors to access funding, strengthen cash flow and maintain a profitable, ongoing relationship with their major client to position the business for future growth”, Greg Charlwood, managing director of Bibby Financial Services Australia said.