When it comes to choosing a finance broker for your business, it’s important to consider what incentives they are getting as part of the transaction.  Good finance brokers are like trusted advisers to their clients, where they have taken the position of the traditional  bank managers of 20 years ago.  Some brokers might be swayed and not necessarily have their client’s best interest at heart, particularly where flex commission can be applied.

What is flex commission?

So, what is a flex commission system and why is it so important to be cautious of finance brokers who might be involved in one? In the most basic terms, a flex commission is where the amount of commission is dependent on the interest rate charged to the consumer. The higher the rate, the more brokers can make.

The new legislation from the Australian Securities and Investments Commission to be introduced in November 2018, prohibits lenders from entering into agreements where the benefits paid to a broker are determined by the interest rate, and the broker can set or influence the rate. The instrument will also place controls on fees charged by brokers, which are designed to stop brokers from increasing their fees and charges to make up for any loss resulting from the ban on flex commission. The ban will apply to all regulated credit contracts and consumer leases, excluding home loans.

Although there are new laws being introduced that aim to halt this practice, as things stand, flex commissioning is still a very real issue that needs to be considered carefully by you or your company before choosing a finance broker. 

Reliable debtor finance company

Whilst we do pay brokers incentives here at BCashflow Positive, we certainly do not enter into any agreements where there is flex commission involved. We also don’t take brokers on fancy holidays to try and sweeten the deal. Our core focus is providing flexible and transparent debtor finance to Australian businesses by unlocking cash from their sales invoices.

How does debtor finance work?

BCashflow Positive’s debtor finance facility can provide immediate working capital for your business by unlocking the cash tied up in your sales invoices. Getting your invoices paid within 24 hours is as easy as 1 2 3:

1. Invoice your clients for the sale of goods or services and send BCashflow Positive a copy.

2. BCashflow Positive will then transfer up to 90% of the invoice value to your nominated account within 24 hours.

3. The remaining 10% is credited to you once your client pays, less any accrued fees.

We are transparent about fees from the start, so there are no surprises.  Give our online fee and funding calculator a go now.  Don’t wait up to 90 days for your clients to pay, unlock growth by unlocking cash from your accounts receivable.

Call 1300 937 292 to speak to a debtor finance expert today.