Oilfield Service Companies are positioned for rapid growth with Invoice Factoring
Charter Capital’s Oilfield Invoice Factoring program was designed to create a cash flow solution for Oilfield Service companies involved in America’s expanding energy sector. Companies in the oil & gas services industry that need working capital but cannot attain it from traditional lenders, use our factoring services as an alternative to conventional bank loans or lines of credit.
By Using Our Oilfield Factoring Services, You Can Obtain Immediate Cash To:
- Add additional employees
- Settle outstanding debt or tax obligations
- Negotiate supplier discounts
- Reduce bank NSF charges
- Underwrite acquisitions of other service companies
- To meet critical operating cash needs such as payroll
The Power of Partnership: United Tank Services’ Client Base Doubled with Charter Capital
How Does Oil and Gas Factoring Work?
To obtain the cash flow they require, oilfield service companies turn to invoice funding. Factoring refers to the sale of unpaid invoices by a company to a third party at an inflated price. This differs from a cash advance, a loan against future sales.
Operational Efficiency in the Oil and Gas Industry with Invoice Financing Solutions
In the changing landscape of oil and gas companies, operational efficiency is important. At Charter Capital, our oilfield factoring services are designed to meet the unique demands of this sector, offering strategic accounts receivable factoring. Specializing in invoice factoring for oil and gas service companies, we provide a solution beyond mere cash flow improvement. This approach allows oilfield service providers to equip themselves with the power of their account receivables, transforming it into an effective tool for sustaining and growing their operations. With our oil and gas factoring services, companies can access the funds they need, often within 24 hours, facilitating seamless business continuity even in the face of long payment cycles common in the industry. Our services are not limited to just invoice factoring; they include a complete financial strategy to support all aspects of oilfield operations, from upstream to downstream and midstream. We understand the complexities of the oil and gas sector and offer financing solutions that empower companies to overcome operational challenges, take on new projects, and stay competitive. Whether it’s for equipment purchase, project expansion, or dealing with slow-paying clients, our commitment to providing superior customer service ensures that your financial needs are addressed promptly.
Key Benefits of Invoice Factoring for Oilfield Service Providers
Invoice factoring is a game-changer for oilfield businesses, offering quick access to cash that keeps operations running smoothly. Long payment terms—commonly 30 to 60 days—often lead to cash flow issues for oilfield services contractors. Factoring solves this by providing upfront funds based on the creditworthiness of your customers, helping businesses stay financially agile.
For oilfield service providers, invoice factoring bridges cash flow gaps for critical expenses like payroll and equipment maintenance, as well as larger, project-based costs such as rig pad preparation. Factoring companies specializing in the oilfield industry also provide receivables funding tailored to unique challenges such as unpredictable project timelines or seasonal demand.
By partnering with oilfield factoring companies, businesses can avoid delays caused by outstanding invoices, negotiate better supplier discounts, and ensure their operations are always equipped to meet demand. This approach not only resolves cash flow dilemmas but also supports long-term growth by freeing up resources to pursue new projects or expand services.
What are the Benefits of Accounts Receivable Financing For Oil & Gas Companies?
We provide Oilfield Factoring services to Oilfield Service companies nationwide. Standard pay terms in the Oil and Gas industry are between 30 and 90 days. These long waiting periods often lead to a “Cash Flow Crunch,” meaning businesses in this industry usually need to investigate financing solutions.
Invoice factoring is an immediate way to get the cash you need to accelerate your business’s growth and profits without needing to take out a loan.
Using oilfield factoring is an effective way for companies in the oil and gas industry to manage cash flow challenges and grow their business without the limitations of traditional bank loans. By leveraging this funding solution, companies can receive cash quickly. This process provides customized financial solutions tailored to the specific needs of oilfield service providers, including pipeline services and transportation services.
Factoring allows you to receive funds upfront, helping you avoid the pitfalls of bad debt and freeing up time and resources to focus on core business operations. With Charter Capital’s industry experience and excellent customer service, we can help your business navigate the unique financial challenges of the oil and gas sector, allowing you to grow, meet payroll, and keep operations running smoothly. It’s important to consider the advantages of oilfield factoring when you’re facing long payment cycles of 60 or 90 days, as it can provide the immediate cash needed to stay competitive in this demanding industry.
Now that you understand the benefits, let’s explore how the process works.
The Process of Oilfield Invoice Factoring: A Step-by-Step Guide
Oilfield invoice factoring simplifies financial management, offering a fast and reliable solution for businesses to secure working capital. Here’s how the process works:
- Invoice Submission: After completing your services—whether routine tasks like hauling or larger projects like rig pad preparation—you submit your invoice to an oilfield factoring company.
- Credit Assessment: The factoring specialists evaluate the creditworthiness of your customers, ensuring eligibility.
- Advance Funding: Once approved, a significant percentage of the invoice amount—usually 80 to 90 percent—is advanced to your business, often on the same day.
- Customer Payment: The customer pays the invoice directly to the factoring company within their agreed payment terms.
- Final Settlement: After the invoice is paid, the remaining balance, minus the factoring cost, is forwarded to your account.
Our back-office support staff aids you in the collection and mailing out of your invoices. This sometimes offsets the financing fees by decreasing internal overhead-related costs.
Personalized Service – You will have a dedicated person handling your account, so you don’t have to worry about starting over with a new person each time you call.
Oilfield Factoring Services provided to these Oilfield Service Companies:
- Roustabouts
- Wireline Services
- Environmental Clean Up
- Well Servicing
- Drillers
- Fishing Services
- Flowback Testing
- Tank & Pipe Cleaning
- Pit Clean Up
- Welding Services
- Acidizing & Cementing
- Plugging Contractors
- Testing Services
- Slickline Services
- And More
Oil and gas factoring can help you get a competitive edge in the highly competitive oil and natural gas services industry.
