Those in business will appreciate the functions and role the factoring companies play in keeping them afloat in their operations. A factoring contract is the only sure way to get immediate capital to inject in if you are experiencing cash flow related problems with your business venture. Your plans do not need to stop because your money is tied in the debts owed by your customers.
As good as the funding seems, it comes with own pitfalls and extra charges that you should be aware of before getting in yourself. Similar to loans and other financial agreements, there are terms and regulations attached to ensure each party is left contended in the end. That is why there are regulations in the industry of factoring companies UK that will ensure your safety when you engage their services. Understand the following three main bodies that regulate this industry;
The FCA- Financial Conduct Authority
This a non-governmental, independent body that regulates all factoring companies UK. This body sets all the regulation standards in that concerns of both parties in the agreements are catered for. Conflicts between parties arise from time to time. If the affected parties can’t solve, this body FCA steps in an arbitrator. As an entrepreneur, therefore, you need to get all relevant information before getting into a factoring service.
The ABFA- Asset Based Finance Association
This trade association is in charge of factoring companies in Ireland and UK. It is regarded as the first regulator in this industry founded in 1976 when factoring companies were still new. Currently, it represents over 95% factoring companies UK with 41 members to date.
If shopping for a factoring company, this is the first trusted point you will get relevant information, trusted institutions, reports and financial advice regarding the situation you are in as at now. You are assured of actual independent information regarding institutions away from luring words most fraudsters use on their website pages co con unsuspecting clients. Companies registered with ABFA are subjected to a code of conduct that centers on fair dispute resolution, integrity and compliance with the set regulations.
The HM Treasury
This is the government arm that regulates this industry. It is usually referred to as the Treasury which is the UK’s finance and economics ministry. It is in charge of all financial matters that automatically places the factoring institutions under it.
The above three bodies will safeguard your interests if you choose to incorporate the service of factoring institutions in your business. Take the risk and see your business grow today.