LB Finance recently introduced factoring for businesses to carry on their day-to-day activities with a smooth cash flow.
Factoring is structured on the principle that businesses of all forms and sizes could sell their invoices to LB Finance and get 70 to 80 percent within 24 hours and the balance of payment after the invoice realizes.
LB Finance would take over the responsibility of collecting the cash on behalf of the company and mange the accounts for businesses to carry on their activities with a smooth cash flow.
LB Finance, Deputy General Manager, Ransith Karunarathne said the fee for factoring would be much more business friendly than the current overdraft rate. The rate would span from 0.5 to 1 percent depending on the invoice value and the credibility of the customer.
He said, "Businesses need funds to carry on their activities and reduce the debt to be profitable. Factoring would help them trade their invoices and gain the necessary capital."
Factoring would reduce the cost for companies from other means as well, he said.
The company would not have to waste their time over collections and increase the staff. LB Finance would be operating their own collection staffs helping the company save there to.
This is far different from other banking facilities which look at a company’s collateral. Factoring will be looking at current assets.
source - www.island.lk
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