Invoice finance may seem like a new concept to many, but it has actually been a useful business-financing tool for thousands of years already. And it just got better.
Sydney-based fintech Waddle has fully automated invoice finance by designing the whole application process to empower business owners to set up an account in minutes without paperwork or confusing finance jargon. Waddle serves as an add-on for cloud-based accounting platforms such as Xero, Myob, and NetSuite to provide businesses with a line of credit facility secured by their receivables.
"Waddle saves brokers time and energy from chasing lenders and filling in forms. Brokers can offer their clients a quality working capital facility that they can "try in full" before signing up,” Yasmine Shah, Waddle's head of partnerships, told MPA, sister publication of NZ Adviser.
“It is also a great revenue stream for brokers. Waddle offers their accredited partners a settlement commission as well as industry-leading trail for the life of the facility.”
Boosts funding line
Also known by debtor or factoring finance, invoice finance allows businesses to convert their outstanding payments into cash. Invoice financiers will place a GSA charge over the business assets and a director’s guarantee only, no property security is required.
According to Shah, invoice finance is a versatile funding line brokers can introduce to SMEs. She said its suitable for businesses involved in manufacturing, wholesales, transport or logistics, and labour or recruitment.
“These businesses endure constant cash flow gaps caused by the payment terms they are obligated to provide to their customers. With an invoice finance facility, businesses can borrow up to 80% of the outstanding sum of their invoices for up to 90 days while they are waiting for their customers to pay them” Shah said.
Waddle was able to streamline the process of customers paying invoice and lenders recovering borrowed funds and paying remaining surplus to business owners’ bank accounts.
Customers can now spend less time administering their invoice finance to their accounting software, and access cash for their business on demand and avoid lengthy waiting periods for payment.
In addition, Waddle has no lock-in contracts and fixed-on going fees, meaning customers have the freedom to only pay what they will use.
“Customers are free from carrying the burden of a cash flow gap in their business, and will receive every opportunity to grow their business,” Shah said.
Brokers who had tried Waddle said their customers adore the platform. They get plenty of repeat businesses, particularly from customers who are constantly in need of equipment, a warehouse, and more cars or trucks.
“I always say to our partners, ‘If you are speaking with an SME who trades with other businesses and has a receivable ledger, ask them for a copy and review their eligibility for an invoice finance facility’,” Shah said.
“You may be surprised at the growth opportunities the humble AR ledger can uncover for their business and for yours.”