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March 19, 2018

8 Benefits of Invoice Factoring

money invoiceWhen working in B2B or B2G sectors invoice factoring is essential. With this type of invoicing, you are provided a short-term capital in exchange for assigning invoices to a factor. The company receives about 80 – 85% of the advanced payment and later when invoice is paid,- the remaining 20%.

Unlike factoring, business invoice finance is easier to use in a way that you don’t need to assign invoices. However, the two terms are often used interchangeably. Here are 8 benefits of invoice factoring in case you are still considering whether to use it for your business or not.

1. Professional Management of Your Finances

When you entrust a professional company to handle your paperwork and collection of payments on your invoices, you save a lot of time. And saving time means saving money. The cost of accessing such services has fallen significantly lately. Though fees vary from one company to another and also depend on what kind of business you have, generally, factoring finance fees range from 0.5 to 3.0%.

Your contract with an invoice factoring company doesn’t have to be permanent or long-term. You are free to choose when to avail yourself of such services depending on when you need them most.

2. Flexible Financing Terms

Accessing finances from banks can be quite challenging for small or medium businesses because most financial institutions prefer to deal with established brands and businesses. The real benefit of using invoice factoring services is that you don’t need to have a great credit or spend years in business to qualify for them.

This happens because the company looks at how capable your customers are of paying the invoices, not how credible or long-term your business is. Moreover, a factor can provide more finances for your business if the need arises. If your business experiences increased sales you can easily apply for more money from a factor.

3. No Stress

You don’t have to wait on your customers to make their payments so you would make yours. Straight away, you are provided with cash on your invoices. You can deal with your taxes and pay all the needed bills on time.

You can proceed with your day to day business without worrying about when you will get paid by the clients. You can actually grow your business, implement new ideas and try new ways of doing business in your sphere while a professional factoring company takes care of your invoices.

4. Growing Your Business

The law of business is if you want it to grow, you need a steady cash flow. Concentrating on your business and acquiring new clients rather than on chasing your debtors will help you do that. As an owner of a business you can pay your suppliers straight away without waiting for some cash from the clients.

Thus, your manufacturing works smoothly and continually without delay. Another benefit is that you will also be able to extend credit lines to your loyal customers. In business, customer loyalty is one of the most decisive factors, so this will give you an advantage over competitors.

5. Easy and Fast Access to Cash

The factoring process is rather quick and not complicated. Usually, the funds are provided to you within 24-48 hours after your invoices have been approved. The initial setup can be 5 top 10 days. However, if you consider business cash flow loans from a bank, it will take you far longer than that.

An adequate cash flow is what keeps your business afloat and growing. All the daily business routines need to be taken into consideration: financing daily operations, paying rent along with utility bills, paying employees and suppliers. That is why it is essential to have cash on your hands at all times.

6. Credit Control

Late payments from clients can cripple your business. A debtor finance company will help you and your employees to concentrate on work instead of chasing the creditors. If you hire an invoice factoring company, it will assume the functions of credit controller and will free time for you to do your business.

An invoice factoring professional knows how to deal with customers who are late on their payments, unwilling to repay their debts or fail to pay them altogether. You won’t have to spend time and money on legal actions against your debtors.

7. Stronger Balance Sheet

Factoring doesn’t appear on your balance sheet or financial statement as an expense because it is not a loan. By using invoice factoring, you avoid taking on a new debt. You will receive the cash that you need to pay your vendors or suppliers on time, to make some major purchase for your business or just to improve your cash flow.

You will use you existing account receivables and this will not be a loan, and thus, not a debt.

8. Profit Predictability

When using invoice finance services you have an opportunity to predict your profits. Since profits can be quite unstable, it is difficult for business owners to make plans.

However, when you use factoring, you know that you will immediately receive most of your payments and thus you can predict your profits and make the needed investments for the future, like necessary repairs or even company expansion.

Invoice factoring can be a huge advantage for small businesses when the credibility of your customers is more important than yours. Invoice factoring services can be beneficial both for B2G and B2B spheres.

Here are some examples of industries where it can be used:

• Construction companies. Construction project need years to be completed but workers need to be paid regularly and on time. Besides, these projects involve a lot of expenditures.

• Trucking companies. There are a lot of expenses in this industry: from truck maintenance to the cost of fuel. You simply cannot afford to wait for 30 or 60 days to be paid for your services. This is where invoice factoring solves the problem.

• Recruitment, staffing and employment agencies. Invoice finance companies are probably the most needed in this sphere. Usually you have to pay your contracted workers before the payment from the clients is received.

• Clothing manufacturers and textile industries. It is obvious that before you receive payment for the products that you sell, like clothes or accessories, you need to invest in materials and of course pay your employees. Utilizing invoice factoring will help you do that without getting into debts.

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February 12, 2018

Few good advantages of Investing in ULIPs

ulip investmentsThe money market will provide you with investment instruments like ULIPs that come with a fair combination of investment and life coverage at once. The premium that you pay for ULIPs are segregated into 2 parts; one portion goes towards investment instruments present in the money market, while the other one goes towards meeting your risk coverage on life. There are a few inherent benefits attached to ULIPs.

5 key advantages of ULIPs over all conventional life insurance policies:

Identify the right blend of investment

Picking the market entities in the right blend often depends on your investment risk appetite. For those of you that are low-risk takers, investing in debt funds is a good ploy. Likewise the moderate risk-takers can invest in balanced funds, while the high-risk bearers can think of equity funds. Balanced funds are a good option lying between equity funds and debt funds. You’ll be able to switch funds once you gain considerable market outlook.

Investment Flexibility

With an ULIP, you’ll gain the right to invest your entire premium value besides gaining opportunities to allocate additional amounts on the policy. Other investment plans don’t yield so much of flexibility. Depending on your risk appetite and your financial profile, you may choose between these two investment strategies:

Life-Stage Strategy: The years remaining towards your policy maturity and your age help in asset allocation.

Self-Managed Strategy: Your fund choice helps in allocating your money. This option safeguards the financial future of your child even when you aren’t there.

Long term investment

ULIPs prove to be a great option for fulfilling long-term investment goals e.g. launching a start-up, buying your new car, and buying a property. ULIPs are designed to yield more returns and that too for a longer duration; they owe this power to their compounding nature. Even if you decide on quitting the ULIP policies after a period of 5 years, you’ll be amazed to see how much more you’ve saved than what you’d see with other investment options. Your money will grow with a much greater momentum and for a longer duration than how you usually see it grow in your savings bank or with your fixed deposits. All you need to do is to determine the amount of investment with the help of an online premium calculator.

Life coverage

Life insurance companies are only known to offer ULIPs in the form of a product. Besides yielding financial protection, ULIPs are known to fulfill your investment needs. Compared to a term plan, the life cover attached to ULIPs may be smaller but they do come with life cover. When it comes to fulfilling your financial goals in the long run, ULIPs constitute a strong investment opportunity. Prior to investing in ULIPs, you must check out the performance of all individual funds in great details. This is likely to provide more insight into investment options with quality returns.

Tax Rebates

Tax benefits aren’t always attached to investment option that you come across in the market. ULIPs come with a combination of tax benefits and life coverage. Under section 80C of the Income Tax Act, you’ll be entitled to receive tax rebates on all paid up premiums. Likewise, all of the payouts that you receive are entitled to tax exemption under section 10D. Besides seeing your money grow, you’ll be happy with how much you’ll save in the end.

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January 27, 2018

What are the best currency pairs to trade?

currency to tradeIrrespective of an ever-changing economic climate, some currency pairs will always be more appealing than others. This is because popularity and size of the market dictate what pairs are frequently traded. High liquidity and low spreads attract a higher number of traders.

The G10 are the world’s most liquid currencies. These are the US dollar, the euro, the Japanese yen, the British pound, the Swiss franc, the Australian dollar, the New Zealand dollar and Canadian dollar, the Swedish krona and the Norwegian krona. Traders regularly buy and sell these currencies, making them the most traded currencies in the world. From here, let’s consider the best currency pair to trade.

EUR/USD

As you might expect, the trading of the world’s two largest currencies would be popular, as a result of its stability and liquidity. It’s a safe bet particularly for beginners, the pair is unaffected by other trades and is not considered volatile. The predictable nature of the way this pair trades, benefits strategists and newcomers alike. The high levels of liquidity mean that this pair often has a tight spread, meaning low trading costs. These low spreads can be taken advantage of by scalpers.

GBP/USD

The aforementioned benefits of EUR/USD are also relevant for GBP/USD. It is liquid, relatively stable and predictable, although slightly less so than EUR/USD. Generally speaking, the similarities continue for performance, the two pairs tend to move in a similar manner, although Brexit developments can impact on this GBP/USD, which have made it more unpredictable than the euro over the past year or so. Beginners are usually advised to not trade both GDP/USD and EUR/USD simultaneously.

Risk Off Sentiment

When market sentiment is negative, investors tend to seek safety in currencies which are traditionally seen as safe havens. The two main safe haven currencies are the Swiss Franc (CHF) and the Japanese yen (JPY). Therefore, when considering which currency pairs are the best to trade, it is also worth considering the trading environment that you are trading in. If it is a risk off environment, where the market is responding negatively to a particular event, then USD/CHF and USD/ JPY could be the best to trade. You could expect USD/CHF and USD/JPY to move lower when investors are searching for safe havens.

Commodity Currencies

Commodity currencies are currencies that move in line with the world’s primary commodity prices. They are Australian dollar, New Zealand dollar and the Canadian dollar. They co-move with a particular commodity price because of these countries heavy dependency on the export of a certain raw material for income. If you are interested in commodity prices, the currencies could be the best to trade.

Which broker?

There are many different currency pairs to trade, depending on your personal preferences and interests. There are also many different brokers through which to chose to trade. However, it is important to choose a broker which provides first rate pricing and execution.

Vantage FX is an award winning Australian broker. It is a true ECN broker meaning that its pricing is inline with that of top institutions and it receives liquidity from the likes of JP Morgan, HSBC, Citibank and RBS to name but a few. Execution at Vantage FX is among the best in the industry meaning you have best chance of making your trade a winning trade.

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January 25, 2018

How to Pick the Right Overseas Money Transfer Company in Today’s World

transfer your moneyBanks and a limited number of high street forex brokers ruled the remittance market until the turn of the last century, giving individuals and small businesses little to no value for money. Now, just about everyone can get access to competitive exchange rates, mainly because a number of companies specialize in this realm alone. How, though, do you select the right money transfer company?

Supported Currencies and Countries

What good is a money transfer company if it does not support your desired currencies or countries? Start by determining if the company you shortlist supports both the countries and currencies in question. For example, while Transfer Wise and World First support most countries and currencies, Azimo lets you register only from a European country, and InstaReM operates mainly in Australasia.

Cost Effectiveness

Do not get carried away by great exchange rates because how much you pay as fees also requires your attention. An easy way to determine the most cost-effective alternative is to look at how much money the recipient will receive at the end of the transfer.

Transfer Methods and Speed

Transfers to bank accounts can take one to seven working days, depending on where you live, the destination country, and the company you select. If you’re in a hurry to send money overseas, a better bet is to look for companies that operate out of physical locations or have tie-ups with agents. Some companies that allow transfers to cash pickup locations include Azimo, Western Union, and MoneyGram. Bear in mind that these transfers tend to cost more than transfers to bank accounts.

Payment Methods

Just about every overseas money transfer company lets you pay through bank account transfers. Some let you pay using debit and credit cards. You can also find companies that accept payments via region specific methods such as ACH, SOFORT, and POLi.

Trustworthiness

An easy way to determine if a company is trustworthy is to check if it is registered with and regulated by relevant regulatory bodies. Depending on where the company is based out of, it may be registered with the UK Financial Conduct Authority (FCA), the U.S. Financial Crimes Enforcement Network (FinCEN), the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), or the Australian Securities and Investments Commission (ASIC).

Keeping Track

Once you initiate a transfer, keeping track of its progress should be simple. Good money transfer companies let you track your transfers through their websites or through apps designed for mobile devices.

Customer Service

The top players provide local phone support in different countries. Online support is easier to find, through email or chat. Since you might need to contact customer service now and again, select a company that rates well on this front. Turning to platforms such as Trustpilot and Feefo gives you easy means to determine how previous customers feel about the companies you shortlist.

Conclusion

There is no single overseas money transfer company that works equally well for everyone, given the varied requirements. To narrow down on one that suits your best, pay attention to aspects such as cost and speed as well as transfer and payment methods.

Jon works as a researcher for iCompareFX. The website lets its users compare leading overseas money transfer companies, and also provides in-depth reviews. When he’s not working, Jon likes to discover new music.

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January 20, 2018

How to Make Your Investments Fly like a Kite

money investmentsOn January 14, you must have seen the skies filled with colorful kites soaring high up. Makar Sankranti falls on the day when the sun leaves the tropic of Cancer towards the tropic of Capricorn, which is called Makar in India.

In other parts of the country, this festival is referred to as Poush Sankranti, Pongal, and Uttarayan. Farmers celebrate this day as it marks the end of the winter and ushers in the harvesting season.

Significance of kite flying on Makar Sankranti

Sankranti means movement and kite flying represents the thankful attitude of humans for this movement. It also has a scientific significance. As the sun commences its journey towards the tropic of Capricorn, it emanates useful rays. When you fly kites on this day, you expose yourself to the beneficial sunrays that have medicinal advantages.

Although Makar Sankranti is over, it is essential that you know about several important lessons this auspicious festival teaches as these teachings may prove to be beneficial during financial planning. Listed below are six important lessons this festival teaches you.

1. Be ready for movement

When you undertake investment planning, you have to understand that it is not a static one-time procedure but requires constant movement. You need to continuously monitor the performance of your long-term investments and make modifications when necessary. Additionally, you need to review and analyze market conditions to identify good opportunities that offer economic advantages to your investment portfolio. When you consider different financial instruments, it is crucial you consider your investment objectives to make the right decisions. This customization of your investment portfolio is comparable to personalizing your kite that has the perfect string which allows it to soar high in the clear skies.

2. Keep your eyes on your portfolio

When you fly your kite on Makar Sankranti, it is important to keep your eyes on it at all times. You must always be aware of how your kite is flying and in which direction. Similarly, prudent financial planning requires that you keep an eye on the performance of your investment portfolio. The performance of the various financial instruments must be in line with your short, medium, and long-term goals.

3. Maintain flexibility

As you fly your kite, you need the string to be kept flexible. This allows your kite to continue soaring amidst gusts of strong winds. This is true even with your short-term and long-term investments. Their performance will not always be the same and there may be ups and downs. Furthermore, the investment environment is not always conducive because conditions are never perfect. There is a possibility that your portfolio may be in the red. You need to ride out the difficult times and remain patient. It is crucial you are flexible and willing to bear temporary losses in the short-term to reap long-term benefits. However, you must never lose sight of your investment objectives and make modifications that become necessary under changing environments.

4. Adequate safety

To ensure you do not injure yourself, you cover your fingers with tapes and bandages while flying a kite. Similarly, you need to ensure adequate security when investing in any financial product. You must protect your investments from significant market conditions.

5. Remain invested

When you fly your kite on Makar Sankranti, you stand the entire day to make gains. Similarly, when you invest in different financial instruments, it is important to remain invested for a longer period. It is said that time in the market is better than timing the market. Therefore, to maximize your gains through investments, it is recommended you hold these for a longer time.

6. Strike the right balance

During winters, days are short and nights are long and vice versa during the summers. However, on Makar Sankranti, the day and night are of an equal length. Just like that, when you invest, you must aim for the right balance between your risks and returns. You must choose financial products that suit your risk appetite while delivering decent returns on your investments.

Striking the right balance between risk and return requires adequate research and effective planning. You need to study the market conditions and understand the features of different financial instruments. This may not be an easy task especially if you are new to investing or have no experience in conducting such analyses.

Through the proprietary ARQ investment engine in Angel Wealth’s mobile application, you can achieve this balance. This engine uses algorithms and quants to analyze a billion data points and offers recommendations that suit your financial objectives and risk appetite. There is no human intervention in the entire procedure ensuring the recommendations are completely unbiased.

Download the Angel Wealth mobile app and apply the lessons learned from Makar Sankranti into practice.

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