The Receivables Exchange, the online marketplace for receivables sales, announced that since inception it has funded over $1 billion to small and mid-sized businesses (SMBs). This milestone indicates that businesses are employing The Receivables Exchange’s working capital marketplace as a proven alternative to traditional lines of credit, and that the online market for receivables sales has become a major new source of business finance for SMBs.
The Receivables Exchange has been on a roll lately, hooking up with Insperity and securing a stratgic investment from the New York Stock Exchange.
The Receivables Exchange enables companies to sell their receivables to a global network of institutional investors, who bid in real time to purchase them at competitive rates. Businesses that trade on The Receivables Exchange are getting rates that are competitive with overall bank financing costs and often much more attractive than other short-term financing options such as factoring and asset-based lending.
“Access to capital is the lifeblood of any business. Receivables constitute the majority of working capital for American small businesses, which support 65 percent of private sector employees and 46 percent of business revenues,” said The Receivables Exchange co-founder and CEO Justin Brownhill. “When SMBs are able to finance their receivables quickly and affordably, it has a direct impact on economic growth and recovery. This billion-dollar milestone affirms our commitment to helping SMBs access the capital they need to help get the U.S. economy growing again.”
“Small and mid-sized businesses are important engines of growth and job creation in this country, but they are extremely vulnerable, currently facing a ‘double credit crunch’ where credit is scarce and customers are significantly extending their payment terms,” said Exchange co-founder and President Nic Perkin. “The Receivables Exchange provides a much-needed solution for SMBs to help them boost capital and grow their business. No other short-term financing option, including banks, ABLs and factors, competes in terms of flexibility, speed and affordability.”
Since the marketplace launched, nearly 2,000 small and mid-sized businesses have signed up to sell accounts receivable on The Receivables Exchange. The largest single receivable sold to date is in the millions of dollars and the smallest is 30 cents. Industries with high activity levels include manufacturing, wholesale and distribution, professional services, staffing, media and technology. While the shortest auction on record closed in only three seconds, 80 percent of all auctions close in as little as 24 hours, with Sellers receiving their funds on the next business day. Nearly 100 percent of all auctions posted to The Receivables Exchange for sale are purchased and funded.