Here’s One For The Love Of Money ( Cash Flow ) Solution In Canada

OVERVIEW – Information on business banking cash flow alternatives offered by asset based non bank lending solutions . These solutions, albeit at a higher cost, offer unlimited cash flow based on sales revenue

Business banking cash flow alternatives might not be considered ‘ exciting
by some – to others though they are critical. We’re the first to admit financing your company might not have the excitement John Hetherington had on Jan 15th, 1797 (He invented the top hat, wore it on the street – women fainted, dogs yelped, he was charged with ‘breaching the peace’!
Nevertheless if you buy into ‘ cash flow’ being king in business it’s prudent to discuss some business banking alternatives. Let’s dig in.

Accounts receivable is a key component of any business that sells on credit. When a true bank business line of credit is not achievable for a business (there are MANY reasons!) A/R finance, a subset of asset based lending, is a solid alternative. The simple way to explain it is getting an immediate advance on your sales and paying a ‘ commission’ for that financing benefit.

On a $10,000.00 invoice as an example a business owner/manager could expect to pay $ 200.00 payment terms to your client are 30 days and they are met.

Canadian banks view your A/R as an ongoing asset on the balance sheet. Based on your end of previous month A/R you typically can create an ongoing borrowing facility of 75% of the value of your (less than 90 day old) receivables.

A/R Financing on the other hand typically advances 90% of your receivables, and advances are made the same day you generate sales invoices. While the bank collateralizes itself by holding on an ongoing ‘ GENERAL SECURITY AGREEMENT ‘ on your business the paperwork structuring A/R finance ( also called ‘ factoring’ and ‘ invoice discounting’ ) reflects you selling on an ongoing basis your receivables and paying the aforementioned ‘ commission’ we have mentioned.

So where do things go wrong when clients wade into non bank A/R financing without experience or assistance? It’s when they don’t understand both the components of the transaction, as well as daily routing involved.

Those components? They include understanding how much is advanced, how that 10% reserve works (you received immediate cash for 90% of A/R- The balance is called a ‘ reserve) and the financing fee or ‘ commission’ we’ve referenced.

Seek out and speak to a trusted, credible and experienced Canadian business Financing Advisor with a track record of success who can assist you with your cash flow finance choices that make most sense for your firm.

The key benefits of this business banking cash flow alternative are constant access to unlimited cash based on your sales, no debt on the balance sheet, and the ability to significantly reduce financing costs by generating more sales at more profits and utilizing cash to take vendor discounts and achieve better vendor pricing utilizing new found cash flow.

P.S. Don’t forget to explore CONFIDENTIAL RECEIVABLE FINANCING which allows you to bill and collect all your A/R in your own firms name- no third party involved.

Author: Stan Prokop – founder of 7 Park Avenue Financial

Originating business financing for Canadian companies, specializing in working capital, cash flow, and asset based financing. In business 10 years – has completed in excess of $90 Million of financing for Canadian corporations. Core competencies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details:


Greg LaBella
7 Park Avenue Financial
Off.   905 829 2653

Cell   905 302 4171