How does Debtor Finance compare to other short-term financing options?
Bank overdrafts are the most common form of short term finance for businesses in the Australian market. With overdrafts, banks often require fixed and floating charges over the business’ assets, and property security, as a condition of providing an overdraft facility. Liberty’s Debtor Finance provides funding based primarily on the value of their outstanding receivables. This means: • More flexibility – funding is made available in line with sales volumes and facility is negotiated to support sales forecasts – not just historic sales. An overdraft often needs to be renegotiated annually, with this process providing a degree of funding uncertainty. • More funding – up to 90% of invoice values can be advanced through Liberty’s Receivable Finance. An overdraft facility is likely to be based on a maximum 50% of the existing debtors’ book. Factoring – Factoring is a lending facility based on the value of the business’ outstanding receivables. However, in the case of factoring, the facility
