by Businesses undergo different phases and not in all phases will they have money for operations. Not having money to pay an employee is the worst that can happen to a business because the success of a business relies on the employees. Luckily, there are many financial institutions that can come in and save the day. Most of them will give you a loan based on the performance of the business, assets, and sales, and accounts receivable. There are many lenders and many kinds of loans out there. Some of the financing sources you can try include:
Business Line of credit
This is the kind of loan that is more like a revolving charge account. Approval takes up t 2 days for most companies and funds are released several days after the approval depending on the company. The credit line is meant for meeting any business expenses you have and that may include payroll services. Regardless of whether you use the account or not, the account will remain open. A business line of credit can be sourced from different places including financial institutions and government agencies.
Payroll loans
There are payroll lenders that can give you a loan especially if it is a short-term loan. This is especially common for companies that are cash based or service oriented. Most of those companies are very fast and efficient and they will make sure that you receive the funds within the shortest time possible with most of them being less than 24 hours.
Selling your accounts receivable
You can do factoring of the accounts receivable for your company in order to get quick cash. There are many factoring companies who will pay you a percentage when you factor your accounts receivable. Most of the time, the amount that you receive will be based on the sales volume of your company and the creditworthiness of your customers. A high performing company will get a higher factoring rate than a regular average company. When the accounts receivable is approved, you get funding in a few days. Click here to read more about Top 5 Advantages in Payroll Service Outsourcing.
Sales based loans
This is whereby a company analyses the company and predicts your future sales. In doing the calculation, your monthly gross revenue will be used. The amount that you will pay back will be a percentage of the future sales of your company. For most companies, the whole process takes a maximum of three days.
Lawsuit loans
This may come in handy in the case where the employer is involved in a case. As they wait for the settlement of the case, they can access a settlement loan which is more like a cash advance that they can use as payroll. The good thing with lawsuit loans is that they are non-recourse meaning that in case you lose out on your case you don’t have to pay. For more information on lawsuit loans, you can check on FAQ on lawsuit funding companies.
There are many sources of loans that employers can use to get payroll. All they need is enough information and that means vast research is a must.…
