The Interface Financial Group Says Accounts Receivable Factoring for Construction Industry Is up 40 Percent

BETHESDA, MD--(Marketwire - January 14, 2009) - The Interface Financial Group (IFG), North America's largest alternative funding source for small business, says that its factoring business in the construction sector was up by 40 percent in the fourth quarter of 2008. The recent tightening of credit markets has been especially hard on the construction industry. Along with industry trends such as sustainable building, there are changes in building code standards that are affecting the industry. The economy and the lack of consumer confidence promise to make 2009 a challenging year for contractors.

Since contractors and subcontractors have certain rights under construction laws in each state involving guaranteed payments for labor and material providers, one of the latest trends emerging is an increase in using factoring, which provides contractors with cash flow to meet payroll and pay suppliers.

Single invoice factoring has become a highly effective cash management strategy, particularly in the construction industry and for sub-contractors who often experience cash flow problems: meeting payroll, buying supplies, paying benefits and Workers Comp. and more. Factoring allows businesses to obtain funds based on their current accounts receivable -- the money they expect to have coming in.

"Contractors have special risks, costs and billing challenges and many factoring companies do not have programs for these industries," said Jan Cunningham, vice president, Interface Financial Group, Inc. "IFG specializes in single invoice factoring and benefits firms that do not get paid for 30, 60 or 90 days by advancing up to 90 percent against invoices."

Invoice factoring is when a business sells its accounts receivable invoices at a discount. Factoring is different from a bank loan in several ways. Banks base their decisions on a company's credit worthiness, whereas factoring is based on the value of the receivables. Factoring is not a loan -- it is the purchase of a financial asset, or the receivable. Bank loans involve two parties, while factoring involves three parties.

The Interface Financial Group (IFG) typically looks at the creditworthiness of a client's customers and pays within as little as 24 hours. IFG does not expect to buy 100 percent of a company's receivables, and there are no minimum or maximum sales volume requirements. IFG's professional rates are competitive because each client's circumstances vary, which may have an impact on the fees charged. The program allows choices of invoices to be factored, enabling customers to retain most of their money, while spending the minimum fees to guarantee adequate cash flow.

"IFG's service has been great. We are finding the services and the process IFG offers has been everything and more," said Crystina Bass, vice president, BAT Construction Group, LLC.

Standard accounts receivable factoring has been around for more than 4,000 years. IFG begins the single invoice factoring process with due diligence that typically takes one to two business days. Once completed the client is at liberty to offer invoices to IFG for purchase. Upon receipt of invoices, IFG checks the credit of the debtor named on the invoice and makes sure that the sale represented has been satisfactorily completed. Once this is done the debtor is advised of the purchase by IFG and the client receives their funding. At the end of the credit period, the debtor pays IFG directly completing the transaction.

About The Interface Financial Group (www.ifgnetwork.com)

The Interface Financial Group (IFG) is North America's largest alternative funding source for small business, providing short-term financial resources including spot factoring (invoice discounting). The company serves clients in more than 30 industries in the United States, Canada, Australia, and New Zealand, and offers cross-border transaction facilities between the U.S. and Canada. With more than 140 offices across North America and over 35 years of experience, IFG provides innovative invoice factoring solutions by offering short-term working capital to growing businesses. Single invoice factoring, or spot factoring, is an extremely fast way to turn receivables into cash.

IFG was founded in 1972 to provide short-term working capital to help small to medium sized businesses grow. The IFG organization operates on a local level, providing clients with local knowledge and experience and business expertise in numerous diverse areas including accounting, finance, law, marketing and banking.

Contact Information: Media Contact: Kristin Gabriel MarCom New Media T: 323.650.2838; E: Headquarters: The Interface Financial Group, Inc. 7910 Woodmont Avenue, Suite 1430 Bethesda, MD 20154 T: Toll Free: USA; 877.210.9748; Canada; 877.340.6893