A company can apply for various types of business loans to address cash flow issues or simply to get a financial boost. One of the ways is through invoice financing or accounts receivable purchase (“ARP”). ARP is different from other conventional loans in the sense that businesses assign unpaid invoices to lenders in return for quick cash. In the previous article, we shared the seven benefits of invoice financing. In this article, we will be sharing some real cases on how businesses are meeting their cash flow needs with invoice financing and ARP from one of our preferred financial partners, IFS Capital Limited (“IFS”).
IFS is a regional provider of accounts receivable purchase for businesses and other commercial financing services such as property financing, hire-purchase/leasing, revolving and term working capital loans, and government-assisted schemes for business enterprises. The group also manages a diversified business portfolio, from asset management to insurance, and fintech. IFS was incorporated in Singapore in 1987 and has been listed on the main board of the Singapore Exchange (SGX) since July 1993.
Here are some of IFS’s success stories in aiding their clients in their collections and how they freed up working capital for them through the ARP program.
A client based in Singapore was dealing with overdue invoices (over 120 days) with a large marine customer. As a result, the company’s cash flow was stuck, and they had limited visibility on the status of their invoices as they were only interfacing directly with the business team and not finance. Dealing with a large buyer also meant it was difficult to get a response on their payment as their customer would be receiving thousands of supplier emails daily and would not be able to entertain every one of them.
With the ARP program, the client was able to rely on IFS to manage collections on their behalf, reducing the burden to perform time consuming follow-ups for payment and reconciliation. At the same time, the client was also able to get updates on their outstanding invoices and secure working capital to improve their cash flows. Within a year, IFS was able to reduce the aging of the invoices with the local shipyard significantly and improved the cash flow situation of their client.
With IFS’s assistance, the client is now able to focus their resources on growth and expansion.
If any of your answer is yes, then IFS’s ARP program can help improve your cash flow and save your resources and time by financing and managing long dated invoices.
A leading bottled drink manufacturer in Thailand was seeking additional funding and working capital from various financial institutions to support its business expansion. However, due to previously strained credit relationships, many of the banks were unable to consider a loan application for the company due to stringent credit policies.
Thankfully with IFS, they were able to leverage on their ARP expertise to look at the company's financing requirements differently. IFS assessed the client based on the quality of their receivables which were against established customers in the modern trade industry. Thus, as long as the goods were delivered in good order, IFS took comfort that their customers would make good on their payment and availed financing support.
With an ARP facility granted by IFS, the client was able to grow their sales 10x and hold the second largest market share in their industry. The client is able to continue to secure new contracts with confidence, noting that the ARP facility granted will increase correspondingly with their increased sales. This was only possible with the improved liquidity supported by IFS’s facilities.
If any of your answer is yes, then IFS’s ARP program is a good and viable credit option for you to free up cash flow and meet your aggressive growth targets.
Take the step to find out more about IFS’s ARP program here or you can simply fill up your details below for a quick eligibility check with one of their representatives.
Jennifer loves helping SMEs in their business growth journey. She is also an epicurean and has perpetual wanderlust. During the weekend, she weaves poems out of thin air and buries herself in books.