Construction Sub-contractors Turn to Debtor Factoring as Business Growth Returns

Sydney, NSW (PR Wire –10 October 2011) – The Interface Financial Group (IFG), a growing source of alternative funding for Australian small businesses, announced that the company offers support to construction sub-contractor businesses who are experiencing cash flow challenges as a result of the long payment terms which pervade the industry. IFG provides short-term financing including single and selective invoice financing to companies in Australia, New Zealand, the UK, Ireland, the United States, Canada, and Singapore.

Last week, the Australian Bureau of Statistics released the data for approvals of new dwellings in August which showed surprisingly strong overall growth of 11.4 per cent. Approvals for new apartment dwellings increased 31 per cent which drove the overall outcome. The strong data suggests that construction sub-contractors will start to see an uplift in business with savvy operators starting to get prepared now from both an operational and financial perspective.

David Hechter, chief operating officer for IFG in Australia said that construction sub-contractors can experience cash flow challenges even when they are growing. “The bigger construction companies only pay their invoices thirty to forty-five days from the end of the month in which a progress claim is submitted. Most sub-contractors will have had to pay for their materials and pay their staff well ahead of the point when they get paid for the progress claim which creates a cash flow gap. The more the subbie's business grows, the larger this cash flow gap becomes. This is why we are seeing more enquiries in relation to invoice factoring from this sector.”

Factoring and invoice discounting facilities involve the purchase of accounts receivable which provide superior benefits to small businesses as compared to loans. These debtor factoring products allow a small business to use the facility only as required without having to be locked in for a particular term. In addition, a factoring facility can grow in line with the value of the accounts receivable as opposed to having a maximum limit linked to the asset value of physical collateral such as property.

Factoring belongs to the family of debtor finance products where a company can use one of its most valuable assets – its strong customer base – as a source of cash flow by selling these invoices. With invoice factoring, there are no minimums, no maximums, no long-term commitments and no lengthy application process.

About The Interface Financial Group (www.ifgnetwork.com.au)
The Interface Financial Group (IFG) provides short-term financial resources including commercial factoring (invoice discounting). IFG launched the Australia operation in 2006 following the success of its New Zealand businesses which commenced in 2004. IFG's innovative products also includes spot factoring – the purchase of a single invoice or number of invoices. IFG does not require the whole debtor book to be financed.

The IFG Network is the funding arm of The Interface Financial Group providing capital and transactional support to IFG's international office network. IFG has grown to over (150) international offices in Australia, UK, the United States, Canada, Ireland, New Zealand, and Singapore. Each IFG office is managed on a local level, providing immediate service to clients with local knowledge and experience. This makes IFG unique to all other factoring companies in the Australia. The IFG team has substantial business experience and expertise in numerous diverse areas, including accounting, finance, law, marketing, banking, etc.

W: http://ifgnetwork.com.au/

Headquarters:
The Interface Financial Group
Suite 1, Level 3, 179 New South Head Road
Edgecliff, NSW 2027
T: Toll Free: 1300 957 900