The Online Business Center

People who have a business want their business go concern. Going concern means that their business has a continuity business process in term of marketing and selling goods and services, maintaining their customers, and financing their business. Facing the era of globalization and free trade today, the competition of businesses is getting tighter. In order a business always keeps running and moves forward, they have to have good resources in terms of money, human resources, and technology. Many people have a difficulty in financing their businesses especially when they try to obtain financing from banks. This happens due to the withdrawals of capital from banks are done through complex requirements and laws as well as the higher interest of collateral imposed by banks. This situation will make the people not concentrate anymore to their business improvement and development. Therefore, the business often falls bankrupt because they cannot make a repayment to the banks.

Looking at to those phenomena, nowadays there are many multifinance companies outside banking institutions or non-banking institutions that are established to help the businessmen or entrepreneurs in financing their businesses. These multifinance companies are established under government’s laws so these companies are legal. Multifinance companies offer many products of finance with different terms and condition. It depends on the product that the client want to have. One of multifinance products that now becomes the most favorite alternative financial tool to get a capital is factoring. This is also called account receivable financing. Receivable financing is defined as a type of financing in the form of purchase transaction and/or transferring any receivables to the third party – that is factor from a client to the party who has receivables. That third party is called factoring company.

Many people use the service of factoring companies because they can easily convert their sales or receivables into cash. They do not need to face complex requirements and high rates to get their money.