The Receivables Exchange Funds Over $1 Billion to Small and Medium-Sized Businesses

The Receivables Exchange, the leading online marketplace for U.S. receivables sales, today 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 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. Typically considered even more important by its customers, The Receivables Exchange also offers SMBs greater flexibility in their financing terms, with no restrictive covenants, personal guarantees, all-asset liens or customer notification.

“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.

Companies in over 50 industries and operating in all 50 states use The Receivables Exchange to manage working capital. Here are some of their success stories:

• A  U.S. certified heat-resistant glassware manufacturer approached the Exchange for financing that would be more flexible than a bank loan. The Receivables Exchange allows the company to grow without extensive collateral requirements and other restrictions.
• A well known engineering services firm uses The Receivables Exchange to balance recurring payroll obligations with invoice remittance from customers. The company is able to control cash flow and fuel consistent growth with a flexible and affordable financial solution.
• An information services software developer uses The Receivables Exchange to manage extended payment terms and fund new product developments. The Receivables Exchange enables the company to access affordable capital and reinvest that capital into growth.

To read about these and other companies who are using the Exchange to gain access to affordable capital, visit our Case Studies page.