7 Reasons To Explore Invoice Discounting As An Investment Option
Alternative investments are all the rage these days. With investors constantly on the lookout for investment options outside of traditional banking and stock market investments, alternative investment options have been gaining in popularity. From invoice discounting to peer-to-peer lending, the options are plenty, but how sure can you be that alternative investments are for you?
The ultimate goal of every investor is to grow their money while keeping their funds safe. What if we told you that you could grow your money, get high returns with minimal risk all in a short period of time! Don’t believe us? Read on to know why you should opt for invoice discounting facility at KredX as an investment.
1. Short-Term Investment Option
Through KredX’s invoice discounting platform, you can invest your hard-earned money and grow it in a matter of just 1-2 months. At the end of the tenure, i.e. 15-90 days, investors receive the capital along with attractive profits. By investing in such short term investments that give higher returns than traditional investments, investors stand to gain much annually through continually re-investing their returns from the previous investments.
2. Investments Stay Safe
Invoice discounting is an investment instrument where the incidence of execution risk is minimal. Contrary to traditional loans that face execution risk as it is taken for an event that is yet to happen in the future such as a house that is being built or a car, at KredX, the investors invest in service as an asset that has already been executed and has an invoice already raised against. Furthermore, KredX takes multiple precautionary measures to minimise the potential risk to our investors.
3. High Returns
KredX offers investors a unique opportunity to invest their money in an instrument that in-turn gives them above-market returns to the tune of 12-20% in annualised returns. This is much higher when compared to traditional investment routes such as FD’s, RD’s, or even the best performing mutual funds (debt or liquid) available in the markets. Invoice discounting as an investment is one of the fastest-growing alternative investments available to retail investors, HNI’s and institutions looking for investment options that can give them lucrative returns while keeping their investments safe and secure.
4. Seamless Integration With Technology
KredX’s unique technology-enabled platform allows investors a hassle-free investment opportunity. They get a holistic end-to-end investment option with professional management and completely digital investment experience at the click of a button. Not only do investors receive real-time status updates about their investments, but they also have access to a personalised dashboard that offers them a snapshot of their portfolio complete with past investments, ongoing deals on the platform, and options to manage funds in their KredX account.
5. Access to Authentic Invoices
All invoices that get listed on the KredX platform have gone through multiple rounds of verification to ensure that only genuine invoices make it to an investor’s screen. In addition to this, it is important to note that the reputable and respected blue-chip companies or corporates that vendors supply to have their own thorough process of vendor verification before they get into an agreement to work together.
Along with the risk mitigation process we follow to protect our investors, there are several legal clauses that bind the vendor and the blue-chip company to fulfill any invoice payments. These payments are performed through escrow accounts that we as an unbiased third-party manage to ensure that there is no influence that neither the vendor nor the blue-chip company can levy on the funds due to our investors.
6. Great Way To Diversify Investment Portfolio
As any investor would know, diversification of your investment portfolio is key to growing your wealth. The high returns with minimal risk in a short time invoice discounting offers make it an ideal option to diversify your profile. An investor should try to diversify their investment portfolio with a healthy mixture of investments in FD’s, PPF, invoice discounting through KredX, mutual funds, and bullion among others.
7. Invoice Discounting Is Market-Independent
Invoice discounting provides a great investment option while protecting yourself against market volatility while reaping high returns. The assets that KredX investors invest in our services or products that have already been supplied with proof of task completion in the form of invoices. It is these invoices that are then discounted and bought by investors on the KredX platform. This completely eliminates any market intrusion and thereby all dependency on market health.
As is the case with any investment, it is the investor’s responsibility to take an educated decision before venturing out on any investment. You could also get in touch with our team at info@kredx.com in case of any queries about our process or investing with us.
How Invoice Discounting Helps as an Investment?
Invoice discounting is a financing method that benefits companies by providing immediate cash flow. Here are some ways invoice discounting can benefit companies
1. Improved Cash Flow
Invoice discounting enables companies to receive payment for
their outstanding invoices upfront, providing them with immediate cash flow to
cover operating expenses, invest in growth initiatives, or pay off existing
debt.
2. Reduced Risk of Bad Debt
Invoice discounting transfers the risk of bad debt to the
financing company, reducing the risk for the company that would otherwise be
responsible for collecting payment from their customers.
3. No Need for Collateral
Invoice discounting is secured by the value of outstanding
invoices, so there is no need for the company to provide collateral like they
would with a traditional loan.
4. Flexible Financing
Invoice discounting can be a flexible financing option for
companies because it can be customized to meet their specific cash flow needs.
The amount of financing can be adjusted based on the value of outstanding
invoices and the company’s financial situation.
5. Improved Creditworthiness
Invoice discounting can improve a company’s creditworthiness
by providing a consistent cash flow and reducing the risk of bad debt. This can
make it easier for the company to obtain financing in the future.
Conclusion
Overall, invoice discounting can benefit companies by providing immediate cash flow, reducing the risk of bad debt, and offering a flexible financing option. Companies should carefully consider the potential costs and risks associated with invoice discounting before deciding if it is the right financing method for their business.
