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: Generate Opportunities, Get More Clients & Stay Motivated

Business Video Roundup: Generate Opportunities, Get More Clients & Stay Motivated

Are you doing enough to generate opportunities for your business? The Ambitious Life host Greg Rollett says that most entrepreneurs are failing in this regard, so he shares a few quick tips to rectify this in our latest video roundup. Also on deck: Marie Forleo answers questions from entrepreneurs and small-business owners on her live call-in show, Brian Tracy gives advice on how to stay motivated through the thick and…

Mike Winters 13.07.2018

Business Video Roundup: Starting a Business, Scaling & Creating Marketing Hooks

Business Video Roundup: Starting a Business, Scaling & Creating Marketing Hooks

In our latest roundup of great videos for entrepreneurs and small-business owners, Brian Tracy dishes out some wisdom to help you accumulate wealth, Evan Carmichael and Stephen Kelly describe the first steps you should take in starting a business (and some mistakes to avoid), and Gary Vaynerchuk reveals the secrets to his success. Plus, Babak Azad of Round Two Partners talks about how he helped fitness company Beachbody scale beyond…

Mike Winters 29.06.2018

Business Video Roundup: Team Appreciation, Social-Media Tips for Local Businesses & More

Business Video Roundup: Team Appreciation, Social-Media Tips for Local Businesses & More

Another week, another roundup of enlightening and motivating videos to help entrepreneurs and small-business owners take their companies to the next level. This time around, Tony Robbins reveals how to master your business, Jeff Rose shares 10 books he says that every entrepreneur should read, and Brian Tracy discusses how to make your team feel appreciated (and how that will benefit your business). Plus, Entrepreneur‘s Kate Volman offers up some…

Mike Winters 22.06.2018
Back
AMERICAN COMMERCIAL CAPITAL HOME

HOW MUCH COULD FACTORING INCREASE PROFITS FOR YOUR BUSINESS?

CALL 713-227-3863