Source From (Business Times): http://www.btimes.com.my/Current_News/BTIMES/articles/SMEZED/Article/
Published: on 11 Jun 2012
However, factoring services provider SME Factors Sdn Bhd may just be the funding solution for SMEs in need of cash.
Chief executive officer Syed Zed Al Qudsy said the bottom line for SMEs is that they need support in terms of funding.
He added that factoring is a viable option for SMEs as it will assist them in their businesses.
Factoring facilities have been in the country for around 30 years, but yet many SMEs do not know or understand about the service, he said.
A factoring services provider is a financier that assumes the receivables of companies to which loans are disbursed.
A typical initial loan facility could be up to 80 per cent of the invoice value.
The factoring company will assume the invoices and in turn collect payment on behalf of its customers.
The payment then will be returned to clients minus the fees for its services.
"In simpler terms, if you have a factoring facility with us, you can trade your invoice and we will give you cash," said Syed Zed.
What distinguishes SME Factors, which was set up three years ago, from other SME loan providers is its accessibility and speed.
"Our products are more accessible to SMEs simply because they are tailor-made for SMEs," he said, adding that SMEs could get the company's facility within three days after an assessment is made. The fund ranges from RM50,000 to RM30 million.
SME Factors currently has more than 2,000 clients from different sectors, such as construction, services and manufacturing.
Moving forward, Syed Zed said plans are in the pipeline for the launch of a fund that caters to the private sector within the next three to six months.
It is also planning for an initial public offering.
"Of course, this year we want to focus on growth and listing is part of our growth, but we want to be sure that we are ready for that," said Syed Zed.
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