I am looking for financing, but I don’t want to pledge assets. How to have your cake and eat it too, or a few key problems that factoring with insurance helps solve
The company is growing, orders are multiplying… But everything has its price. Development requires working capital for, among other things, the purchase of materials or freight of goods. When looking for financing for their business, an entrepreneur usually views hard bank guarantees, such as setting up a mortgage or strict control of the operating account, with reservation. If we do not want encumbrances on our assets, and receivables insurance is essential for us, non-recourse factoring will be an attractive alternative to a traditional working capital loan. Let’s find out why!
Key takeaways:
- Professional factoring for companies does not require providing hard asset collaterals (such as a mortgage or registered pledge), which allows you to maintain full business independence and protect the private assets of entrepreneurs.
- Factoring at Ifis Finance means operational freedom – cooperation does not entail the obligation to change banks or grant us powers of attorney over your company account.
- Modern factoring with insurance acts as a double shield: it not only instantly “frees up” cash frozen in issued invoices, but also protects the entrepreneur against the risk of contractor insolvency.
The SME sector and traditional financing. Why do they have a difficult relationship?
In business, just as in sailing, to sail forward and effectively catch the wind in your sails, you need ballast to stabilize the course. This ballast is financial liquidity. However, market realities show that small and medium-sized enterprises are often dependent on the stage of the economic cycle in this regard. Although the NBP report from August 2026 confirms the easing of bank policies under competitive pressure, which has recently translated into a greater number of granted loans, certain structural barriers remain persistent.
– In the case of the SME sector, especially in the service area, the most common barriers to obtaining a working capital or investment loan are irregular revenues, often resulting from the seasonality of a given industry, as well as the lack of fixed assets that could constitute sufficient collateral. Debt, combined with seasonality and lower profitability and liquidity than in large companies, can result in problems with paying off liabilities, which ‘scares off’ large financial institutions – explains Leopold Kasjaniuk, General Manager at Ifis Finance. – That is why banks require ‘hard’ collaterals, which becomes an insurmountable obstacle for many entrepreneurs. The prospect of risking a private home, family plot, or a key production hall effectively discourages owners from using loans. This creates a sad impasse: the company has the potential for growth, but rejects lucrative contracts out of fear for its fixed assets – he adds.
Time: the silent opponent of small and medium-sized businesses
The need to save liquidity is particularly acute wherever revenues tend to be unstable and irregular. In trade, food production, or broadly understood services, many weeks or even months pass between the execution of an order and the physical receipt of cash in the account. According to data from the Credit Information Bureau, nearly one in three companies in Poland waits for payment even 60 days past the due date.
The pressure is enormous. The service industry strongly feels the consequences of current turmoil – high electricity and gas prices directly lower its profitability. A similarly difficult situation prevails in transport and logistics, especially among small carriers. Rising fuel costs, a huge number of taken-out leases, and fluctuating rates are a challenge, but it is precisely long payment terms and delays from clients that turn out to be the main cause of liquidity problems. Being dependent on timely transfers, companies from the SME sector become victims of bottlenecks that prevent them from paying their own obligations.
Alternative receivables insurance? Factoring for companies!
The solution to the above ailments can be a financial service that fundamentally assesses not so much your creditworthiness and owned real estate, but the real value of your trade receivables. A service that is dynamic and scales with the current needs of the business. This is exactly how modern factoring works. Instead of burdening your mortgage, this mechanism fully utilizes what you have already worked for, providing access to funds almost immediately after transferring the invoice for financing.
The main and market collateral for the transaction is the undisputed receivable itself (i.e., a correctly issued invoice) in the form of a confirmed assignment of receivables, and the additional collateral is a blank promissory note along with a promissory note declaration. The message in this case is very simple and reassuring: the financing institution secures itself on the receivables resulting from invoices, and your fixed assets – conversely to the case of a traditional loan – remain free from rigorous encumbrances.
At this point, it is also worth emphasizing the difference in the accounting treatment of both solutions. A working capital loan is a traditional financial obligation that increases debt and directly burdens the creditworthiness of the enterprise. In turn, full (non-recourse) factoring for companies consists of converting receivables (assets) into cash – it does not increase the company’s debt, and therefore does not hinder the path to possible, additional financing in the form of a loan.
Factoring with insurance (non-recourse) – transfer the risk of non-payment to the factor
The combination of quick access to cash and the lack of hard collaterals is one of the main advantages of factoring. But the benefits do not end there. In the event that a company’s contractor tends to settle invoices past the due date, receivables insurance becomes a priority. Non-recourse factoring, also called full factoring, guarantees that the factor will not only pay you an advance for the issued invoice but will also take on the risk of non-payment. However, for our protective shield to work correctly, clear conditions must be met: the receivable submitted for financing must be undisputed, and the lack of payment settlement itself must result from the established insolvency of your recipient.
– Considering receivables insurance, factoring acts as a shield protecting small and medium-sized companies against the domino effect – in a situation where a large contractor, e.g., a general contractor, declares bankruptcy, you sleep soundly, because the funds paid by the factor remain in your account. If you plan secure development and are interested in solid receivables insurance, factoring with insurance will provide you with invaluable peace of mind – emphasizes Leopold Kasjaniuk.
Factoring for companies at Ifis Finance: business, Italian tranquillità
At Ifis Finance, we strongly emphasize relationships, a boutique approach, and mutual trust – this is the reason why our clients work with us for years. We know perfectly well that a down-to-earth entrepreneur values independence the most. Therefore, one of our advantages over many traditional institutions is the fact that we do not interfere with the architecture of your company’s finances.
We reject dry, automated scoring systems in favor of a rational approach and individual analysis carried out by a dedicated account manager. We do not take powers of attorney for our clients’ accounts and absolutely do not force you to transfer turnover to another bank. You maintain full flexibility, and we pay advances to the account you designate yourself.
Instead of taking control, we provide a flexible tool that allows you to safely diversify funding sources and easily scale the company’s operations. By choosing factoring at Ifis Finance, you gain not only a stable source of capital but, above all, full operational independence and peace of mind, i.e., business, Italian tranquillità.
Frequently asked questions (FAQ) about factoring with insurance
What exactly is factoring with insurance?
This is otherwise known as full (non-recourse) factoring. It defines a mechanism in which the financing institution (factor) pays you cash for the receivables resulting from an invoice and simultaneously fully assumes the risk of your contractor’s insolvency. If your recipient declares bankruptcy after some time, you keep the paid advance, and the burden of potential loss rests on us.
Does factoring for companies mean I have to open a new bank account?
No. At Ifis Finance, we do not open new bank accounts and do not ruin the financial arrangements you have developed. The funds released from invoices are transferred in the form of an advance to your current account, which you indicate yourself – we in no way take powers of attorney and do not interfere with the structure of your company’s bank accounts.
Does receivables insurance in factoring protect me in quality disputes?
No. Protection against insolvency will work correctly only in a situation where your invoice is undisputed. If the contractor withholds payment by officially reporting a trade dispute (e.g., alleging defects on a construction site or flaws in the supplied material), the responsibility returns to you until an objective and legal resolution of this dispute. Reliable fulfillment of contracts is therefore the basis for the efficient operation of this mechanism.
