The History of Invoice Factoring (And Factoring’s Growth in the 21st Century)

Posted on 16.July.2015 by Mike Winters | @amcomcap

InvoicesInvoice factoring has remained much the same since it came into vogue in the Middle Ages. Yep, factoring has been around a long, long time. Invoice factoring has always been a fast, reliable way for businesses to improve cash flow without getting bogged down with debt that has to be repaid. The first recorded use of factoring is said to have been 4,000 years ago, in the kingdom of Hammurabi of Mesopotamia, but let’s take a brief look at its history over the years through today.

The following infographic tells the story of invoice factoring in a nutshell, noting its use by Jewish businessmen in the 1300s and 1400s and later by English merchant bankers advancing funds to colonists settling in America in the 1600s and 1700s. Jumping ahead to the 1910s and 1920s, invoice factoring was popular in the garment and textile industries. In the 1940s, the United States saw a factoring boom in the textile and transportation industries. And in the 1960s, ‘70s, and ‘80s, “rising interest rates and bank regulations made invoice factoring more popular as it did not require the same sort of credit checks.”

The same thing may be happening today, as it’s becoming harder and harder for small businesses to get approved for traditional bank loans and financing. Will we see another boom in invoice factoring for small businesses? Time will tell. The use of invoice factoring has already grown by 15% in the U.S. since 2004. As businesses become aware of factoring’s benefits—immediate cash flow for unpaid receivables, no credit checks, a reliable option for businesses who can’t secure a bank loan, among others—it’s likely we’ll see an uptick in businesses using invoice factoring to grow and succeed.

Here’s the infographic on the history of factoring and its growth in the 21st century, courtesy of CBAC.

History of Invoice Factoring (Infographic)

image description

Roy Brooks and American Commercial Capital, LLC, has provided invoice-factoring services to Houston-area small businesses since 2003. We work with businesses in San Antonio, Dallas, Austin, Fort Worth, Beaumont, Port Arthur, Corpus Christi, and other nearby Texas cities.

If you want to learn more about how cashflow-sensitive invoice factoring can help your business, give us a call at 713-227-3863, contact us here, or fill out our form for a free, no-obligation quote.

READ MORE FROM AMERICAN COMMERCIAL CAPITAL

Business Video Roundup: Marketing Strategies, Customer Service Advice & More

Business Video Roundup: Marketing Strategies, Customer Service Advice & More

In this week’s roundup of great videos for entrepreneurs and business owners, Gary Vaynerchuk talks business with Tom Bilyeu, co-founder of Quest Nutrition and CEO of Impact Theory, and Marie Forleo talks marketing with Seth Godin, former dot-com business exec and bestselling author. Then Evan Carmichael shares six pieces of life-changing advice from Warren Buffett, Stanford GSB professor Huggy Rao discusses what employees really want, and PuroClean CEO Mark Davis…

Mike Winters 16.11.2018

Business Video Roundup: Customer Service Tips, Bosses vs. Leaders & Empowering Employees

Business Video Roundup: Customer Service Tips, Bosses vs. Leaders & Empowering Employees

Are you a boss or a leader? That’s one of the questions explored in this week’s roundup of great videos for entrepreneurs and business owners, and finding out the answer to that question could help you become a better manager and business owner overall. Also on deck: Marie Forleo drops four customer-service tips that will make your business stand out, Clear Automation CEO John Deblasio talks about the importance of…

Mike Winters 10.11.2018

Business Video Roundup: Building an International Brand, Skills That Attract Success & More

Business Video Roundup: Building an International Brand, Skills That Attract Success & More

In this week’s roundup of great videos for entrepreneurs and business owners, Lululemon founder Chip Wilson shares insights and business stories, Evan Carmichael lays out six skills that can help you to achieve success, and Horizon Pharma CEO Tim Walbert extols the virtues of having a diverse mindset. Plus, Brian Tracy shares four tips for building an international brand and world-famous pastry chef Dominique Ansel talks about how he comes…

Mike Winters 2.11.2018
Back
AMERICAN COMMERCIAL CAPITAL HOME

HOW MUCH COULD FACTORING INCREASE PROFITS FOR YOUR BUSINESS?

CALL 713-227-3863