Invoice financing allows you to boost your cash flow through raising a sum of capital that can be reinvested into your business within a matter of minutes, and ultimately transforming the 30, 60 or even 90 day waits businesses commonly face with invoicing.

In this article, Forbes Burton is here to provide you with the benefits of Invoice Financing and how the process actually works.

How Does It Work?

As you begin to increase your sale invoices and send them to your clients, you simply provide a copy to your invoice finance provider who can make a payment of up to 90% of the invoice value immediately.

Alongside this benefit, you also don’t need to chase the client for any form of payment, as the invoice finance provider will do all of this for you.

As stated above, this means you no longer have to cope with the long and drawn out payment times. Instead, you will have your payments given to you within a 24 to 48 hour time period of your invoice being raised.

This means that you effectively have your earned cash on delivery for you, whilst you still offer your normal credit terms to your customer.

With invoice factoring, you will find three different types, which are –

Factoring

Factoring is where you continue to raise and dispatch invoices in the usual way you would, and send a copy to your factoring company.

On receipt, your factor will then have available funds of up to 90% of the value, and these must be used immediately.

When your client then decides to pay you, any outstanding payment will then be paid to you, minus the charges for the use of the facility.

The factoring company in question will then control your sales ledger for you and carry out the credit control, all on your behalf, which helps remove the commonly, time-consuming task of trying to chase your customers for the needed payment.

Instead, you can focus on the most important aspect, which is your business.

Spot Factoring (Selective Invoice Finance)

Spot Factoring (also referred to as Selective Invoice Finance) provides you with the flexibility to choose which invoices you would like to use to raise the working capital your company requires.

Also, with Spot Factoring, there is no minimum contract period, so you can use this service as frequently as you need, or just as a one time requirement, to help meet the cash flow status your business needs and deserves.

Any invoice which is funded will be firstly sent to the Spot Factor, where they will make a payment of up to 90%.

Invoice Discounting

The process of Invoice Discounting works the exact same as Factoring, in terms of that you can draw money against your invoices in advance of your customer payment. But, the difference with Invoice Discounting, is that you retain the credit control process in house and you continue to handle the process yourselves, without external help.

This process is commonly complete through a confidential basis, which means your clients are unaware of how your business is being financed.

Back To Invoice Financing – Here Is An Overview

• Invoice Financing allows you to receive the payment you require (from up to 90%) within just a 24 hour time frame. Plus, you don’t need to wait for your invoices to clear to receive your payment.

• It helps you maintain your working capital that you can access, as it becomes tied up in invoices.

• We recommend that you take advantage of the professional sales ledger management, as a fully qualified professional client manager can handle this process for you, which means you don’t need to further employ in house, as your finance queries can remain separate to your business environment.

• Using Invoice Financing lets you stay away from the threats of having bad debt upon your business, as you receive credit protection that can guard you away from late or non paid invoices.

If you decide to set this up for your business, all you need to do is send over any raised invoices and your provider will give you funding, which helps make the bain of day-to-day finance commitments a thing of the past.

Whenever invoices are due, they are simply collected on your behalf from customers, from an external finance expert, so you can keep your main focus on the success of your business.

Every business deserves the money they earn through customers, and late or non existent payments should not be something any business should face.

Find the help you need and make the fear of invoicing disappear today.

Bitcoin may have set the standard and made cryptocurrencies a reality, but protocols with greater functionality have been developed over the years. Recently Weiss Ratings came up with a unique model to identify some of the better networks using a few data points. This model measures a cryptocurrency’s potential to achieve specific goals, including governance capabilities, high transaction speed, scaling solutions, flexibility to upgrade, energy efficiency, decentralization, and how well the cryptocurrency’s technology has sophisticated the monetary policy.

Cryptocurrencies such as XRP, Ethereum, and Cardano have developed technology solutions that solve different challenges in different sectors, including the financial industry.

Protocols for payment providers

An example of a protocol that is taking care of payment providers is RippleNet. Its solution caters to institutional payment providers such as money service businesses and banks that use Ripple’s solutions to provide easy global payment solutions. This technology has contributed significantly to increased XRP investment on platforms like PrimeXBT, where users can trade the asset using CFDs with low fees and excellent security for their funds.

This platform works by connecting buyers and sellers. Imagine the case of Mr. Ed, who lives in Los Angeles and has a chocolate box that he no longer needs. But he is interested in watching a baseball game, but he doesn’t have a ticket. Then there is Joan, who lives in New York and has extra tickets she doesn’t need. Interestingly she wants a chocolate box. Normally, these two are unlikely to find each other and exchange the undesired items.

However, with the Ripple platform, both can find each other and exchange the items. Moreover, this platform allows payment in multiple currencies, including Bitcoin. The minimum transaction cost is $0.00001.

Such advantages make this protocol so attractive to many investors on PrimeXBT, Bitiq and other platforms, since it allows users to send money faster, cheaper, and more conveniently.

 Smart contract protocols

Ethereum is another platform with superior technology to Bitcoin. Applications built on the blockchain make it possible to create new digital assets, build decentralized companies, virtual worlds, and manage property. These applications, better known as dApps, are unstoppable and uncensorable.

Dapps are web applications built on smart contracts. Instead of using a centralized database or server, these applications rely on blockchain for storage and program logic. Consequently, developers can create unstoppable applications.

Over a decade ago, the birth of Bitcoin made us reassess what we consider as a store of value. The technology also helped us get an idea of what the future holds. And protocols that followed have been improving on its capabilities, at least some of them like Ethereum through smart contracts and decentralized applications.

These dApps are resilient, transparent, distributed, and incentivized. They have changed the technological landscape.

Additionally, dApps are governed by autonomy, and all changes and developments are decided by consensus. This gives the public power to choose and allows scrutiny. Validators of the blockchain are incentivized using tokens. These rewards motivate the developers to create even better-decentralized applications that are changing different industries today.

Cardano is another excellent example of a platform that uses smart contracts to improve on Bitcoin’s shortcomings. The platform has two main layers, the Cardano Settlement Layer (CSL) and the control layer. The CSL is used to settle transactions using ADA.

The Control Layer, which is still under development, will be used for smart contracts. The cryptocurrency’s hierarchical structure enables Cardano to be used as a medium of exchange and generate smart contracts.

Cardano ensures security through the peer-review process required for new updates. The founders of this platform want to ensure that anything new introduced to the ecosystem is not compromised. Other cryptocurrencies have experienced challenges with security. For instance, the Verge experienced multiple hacks. Other projects were criticized for adding a new algorithm that was untested.

Cardano’s new concept ensures that the relevant individuals first scrutinize all algorithms added to the platform.

Cardano also solves the scalability issue by taking ideas from cryptography researchers. Some of the ideas have been implemented and are being tested. However, most ideas are still in the research phase. Cardano has not deployed any smart contract platform yet, but things look promising.

Conclusion

Since Bitcoin was launched, consequent digital currencies have sought to develop solutions for different market challenges and industries. Solutions such as RippleNet, dApps, and Cardano aim to provide solutions to challenges that Bitcoin has not.

However, there are many challenges that should be overcome before the masses can widely adopt these protocols.

The GFC (Global Financial Crisis), a worldwide money-related emergency, alludes to a time of extraordinary worry in worldwide budgetary business sectors and banking frameworks from mid-2007 to mid-2009. At the time of GFC, a plunge in the US lodging market was the impetus for a monetary emergency that spread across the United States, stretching over the rest of the world through linkages in the worldwide money-related framework. Numerous banks the world over caused huge misfortunes and depended on government backing to stay away from chapter 11 bankruptcy. A large number of individuals lost their positions as the best progressed economies encountered their most profound downturns since the Great Depression in the 1930s. Recuperation from the emergency was likewise much more slow than past downturns not related to a budgetary emergency.

You can check out research papers and articles to find out more about the timeline of financial crises. In this post, we will try to focus on the primary point that lead to such crisis.

What Caused the Global Financial Crisis?

The following are a range of factors that influence the severity and occurrence of a massive financial crisis worldwide.

Macroeconomic environment and risk-taking

In the years that paved the way to the GFC, monetary conditions in the United States and other nations were good. Monetary development was solid and stable, and paces of swelling, joblessness and intrigue were moderately low. In this climate, a housing bubble developed that would inevitably burst.

Extremely low interest rates led to an uplift in house prices in the United States, as even borrowers who previously wouldn’t have been given a mortgage owing to their ‘subprime’ status were able to secure loans, despite their higher default chances. Moneylenders then sold these loans on to large banks.

Banks and moneylenders were happy to make progressively enormous volumes of hazardous advances for a scope of reasons:

• Rivalry developed between banks to broaden ever-bigger measures of lodging credits that, as a result of the favourable financial climate, appeared to be truly beneficial at the time.
• Numerous banks that gave mortgage advances didn’t properly evaluate the borrowers’ capacities to make credit reimbursements. Additionally, moneylenders had minimal motivating force to take care in their loaning choices since they didn’t anticipate bearing any misfortunes. Rather, they offered a lot of advances to speculators, usually as advance bundles called ‘mortgage backed securities’ (MBS), which comprised of thousands of individual home loan credits of differing quality. After some time, MBS items turned out to be progressively intricate and hazy but kept on being appraised by outer organisations as though they were sheltered.
• Financial specialists who bought MBS items erroneously imagined that they were purchasing an okay resource: regardless of whether some home loan advances in the bundle were not reimbursed, it was expected that most credits would keep on being reimbursed. These speculators included huge US banks, just as unfamiliar banks from Europe and different economies that looked for more significant yields than could be accomplished in their neighborhood markets.

There are several other contributing factors that led to the Global Financial Crisis in 2007-8, but the housing bubble that swelled based on irresponsible subprime lending in the years leading up to the crash was a direct reason for financial collapse in the years that followed.