[Kevin Henry-Seacoast]

our lowest rate is 2.5% a month upto 5% we average at 3.25

2.5%/Month? Yikes...that's expensive. There are a host of firms out there offering $1Mil factoring facilities and asset based lines of credit from 6%-10% annualized rate.

[Kevin Henry-Seacoast]

great, so go get all your clients those facilities

All of my clients have these types of facilities. Some have been with me for over 8 years.

[Kevin Henry-Seacoast]

That doesn't mean you had customers that didn't qualify for those. If they are clients with those facilities then obviously that's just counting all the ones that qualified. Higher factoring rates for higher risk clients, not to mean high risk just higher than what your banks would accept. Several levels

You would be amazed what some bank owned finance companies can accomplish up to and including DIP financing. Hell...I have financed companies with federal tax leans and had the IRS subordinate behind the factor/ABL. Banks are starting or buying non-bank finance companies (factors and ABL) as a way to say YES to the client. Non bank finance companies are partnering or selling to banks because they need a lower cost of funds and other services to offer to their clients to compete. There is a large factor in the market to buy a bank right now because they need the depository relationships to lower cost of funds. It is super hard for small players and non-bank finance companies to compete with the likes of a bank owned finance company with $3Bil of free deposits to deploy........