Did you land that government contract?
That’s a dream come true for some small businesses because it can lead to expansion and entering new markets.
With this government contract you’ll have…
- Guaranteed work
- Confidence that your customer (the government entity) won’t default on their payment of your invoice
- Assurance that you and your staff will work in safe, regulated environments
- And the advantage of having the contract renewed, which is essential to long-term business growth
However, you will discover that doing business with the government has its own set of challenges.
Government contracts often require large outlays before you ever get paid. We recommend noting the terms of the invoice prior to taking on the contract. Also, note that there can be challenges in getting payment on time, which may leave you scrambling to meet payroll needs, purchase supplies, or cover operating costs.
What about a bank loan? While a bank loan seems like the only option, small business owners don’t always have that option. Even for an established business with a great credit score, a bank loan can take months to process before you see the funds. That is why government invoice factoring is vital to companies with government contracts, and you can go from application to funds received in 7 to 10 business days.
The Solution? Factoring.
Our experts understand the difficulties of these contracts and the intricacies of how election years, holidays, government shutdowns and even votes can delay payments. By factoring government receivables, your business will have fast access to the capital owed to you through those government invoices.
As a client of United Capital Funding, here’s how it works:
- First, you fulfill the agreed-upon service or order of goods laid out in your government contract.
- Then, generate an invoice for the total amount of the service provided and send copies to the government entity and United Capital Funding.
- Our experts will verify the invoice, then wire a large percentage (typically 80%) of the invoice amount to your account, holding the remaining percentage (20%) until the government entity pays the full invoice amount to our secure lockbox.
- Once the government entity pays the full invoice amount to our secure lockbox, our team wires the remaining percentage (less our fees) to your account.
- Voila! You’ve successfully unlocked that capital.
Factoring is a steady, long-term solution for your invoice management. We allow you to choose which invoices you want to factor and you can access your invoices and reports through our secure online platform, all at no extra cost.
What are the fees?
You will typically only encounter two types of fees – a fee for the cost of the capital and a banking fee (ACH or wire transfer charge). Our fees are drastically lower than the industry average, according to Pepperdine Graziadio Business School’s 2019 Private Capital Markets Project. This keeps your total costs down and your invoice cycle efficient. Visit our benefits page for more information. We offer customized proposals according to your specific needs. To receive a proposal, please submit an online application.
Please note, factoring is not a loan. It is an advance on pending payment by your customer, which means there is no repayment on your part.
Three Ways to Get Started
Our experts can answer your questions and ensure you understand the process of factoring government receivables. We will also ensure that all of our receivables funding will be in full compliance with regulations including applicable Federal Acquisition Regulations and the Assignment of Claims Act.
“Nothing but great things to say about your customer service and help guiding my company throughout the process. Gives us confidence to go after more work opportunities and grow our business.”Owner, Government Contractor, Virginia
We are experts in dealing with all facets of government invoice factoring, including…
- working with your CO
- managing documentation requirements like Notice of Assignment and Assignment of Claim forms
- turning invoices into the capital needed to grow a business
We can do this even if you are a startup, an 8(a) contractor, or are a company with a recent history of a less-than-profitable performance.