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How is Payroll Financing Different from Traditional Business Loans?
Payroll financing provides a quicker, less risky, and hassle-free solution to your cash flow issues when your company is unable to process employee's salaries.
By: 1 Click Capital
What is financing for payroll?
Payroll financing, is a kind of loan service that enables businesses to get funds for the processing of their payrolls. Businesses can face difficulties managing their cash flow and making payrolls on schedule. According to a report, 40% of businesses experience cash flow problems. A business's need for extra funding is not an indication of poor management.
The main objective of 1 Click Capital is to ensure that your employees are paid in order to maintain the viability of your company. 1 Click Payroll may assist you in financing your weekly or monthly payrolls, regardless of how frequently you run them.
What makes payroll financing different from business loans?
Long-term payments are lower
The fact that you only pay for the amount you have been sued is one benefit of invoice financing. A business loan often involves monthly interest payments or fixed-term repayments rather than a one-time cost per payroll.
Quick access to a credit line
The payroll financing approach is a faster way to receive money than business loans. Payroll financing enables you to obtain funds as soon as your payroll has been accepted, unlike traditional loans, which take longer to complete and are therefore less suited when you require an immediate influx of cash.
Lesser documents required
Asking for payroll finance doesn't involve as much paperwork or cash advance covenants as applying for business loans. Even if there is some paperwork still necessary, it is usually straightforward and can be completed in one sitting, making it a sensible option in cases of financial exigency. Unlike traditional loans you can apply online in just few steps and get approved within 48 hours for a line of credit.
Low risk and commitment
You normally must provide collateral for business loans, which can be either corporate or personal assets. The fact that payroll financing is solely secured by your payroll receipts, limiting the loss of important assets in the event of default, makes it more secure for you.
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