In the not-too-distant past, if a freight transportation company needed access to cash, they had to get a business loan. They would have to go to a bank, apply for the loan, often put up their assets as collateral, and, if approved for the loan, begin making payments right away. Well, thanks to technological advances in alternative financing, you may not have to jump through all those hoops anymore. Here’s how fintech companies have broken down cash flow barriers for freight companies.
Freight Factoring
You need your money as soon as you can get it, whether it’s to pay for gas, perform vehicle maintenance, or expand your fleet to meet growing demand. Fintech providers have streamlined the freight factoring process so that you can get your invoice funds almost immediately after you submit them for payment.
You don’t have to wait for slow-paying customers any longer because fintech companies will advance you up to 100% of your invoices (minus fees) by transferring the funds to your online account within minutes of approving your payment request. No lingering debt, no regular payments, no reporting to your lender. You simply submit your invoice and supporting documentation through a secure portal and receive the funds you need.
Commercial Visa Cards
Getting money into your account through freight factoring is one thing, but dispersing it to employees who need it is entirely different. You don’t want to give them full access to your factored funds, but you want them to be able to pay for the business expenses required to keep your company running.
Through a fintech collaboration with Visa, you can transfer funds immediately to your employees’ Visa cards so they can pay for gas, parts, and other operational expenses. They can even get up to $300 cash per day at thousands of ATMs. You can set spending limits for each card and track every expense through your mobile app. It’s a simple way to keep the cash flowing to your employees for seamless operations.
Asset-Based Line of Credit
Freight factoring is great if you stay busy all year, but if you have a company that experiences seasonal highs and lows, accessing cash can be difficult. Advances in fintech have given rise to asset-based lines of credit that can ensure you have steady access to funds all year long.
And there are many paths to these funds, including advancements on your accounts receivable, your appraised value of M&E, your FMV real estate, your inventory, and more. Creative alternative financing like an asset-based line of credit can keep your company afloat even during the times when your business is slow. While this method of financing takes longer than freight factoring, it’s a viable solution to seasonal cash flow fluctuations.
Conclusion
Whether you need fast access to cash to keep your business operating without disruption or you need to tap into your assets to grow your company, alternative financing options through fintech providers can get you the money you need. And even better? You don’t have to even step foot in a bank to get it done.
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