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08/01/2013 – Paragon Financial Sees Increased Need for Accounts Receivables Factoring Credit Protection Against Customer’s Client Bankruptcy


Ft. Lauderdale, FL – August 1, 2013: Paragon Financial Group Inc. (“Paragon”) sees an increased need for credit protection for their Accounts Receivable and PO Financing clients. Credit protection is an essential aspect of business factoring services and financing receivables but few Factoring companies provide the protection to 100% of their clients. Credit insurance protects you against the risk of your customer’s bankruptcy.

According to a National Small Business Association survey, Fifty-one percent of small business owners say they anticipate a flat economy in 2013. Thirty-five percent foresee a recession, while just 14 percent anticipate that the economy will grow. Furthermore, J. Bradford DeLong, an economics professor at University of California at Berkeley, sees few signs of a rebound, adding that Washington’s austerity policies only “dig the hole we are in deeper.” The percentage of workers in the labor force remains at lows not seen for a quarter-century.

This sense of pessimism from both business owners and economists give companies factoring their invoices more incentive to protect themselves from an insolvent client.

Linens N Things, Circuit City, Kodak, Adelphia, General Motors – the list of blue chip companies that stung small vendors by filing bankruptcy is long and ever growing. When a company sells their invoices to a factoring firm, they get the funds upfront that they need for working capital and for investing in the growth of their business. Revenue flows directly to the company, and they hope they do not have to worry about collections. However, what about the Credit Risk?

Receivables financing by itself does not protect a business against non-payment by their customer. If factoring is done “with recourse” and if the factoring client’s customer does not eventually pay the factoring company, the factor can charge the invoice back to the company. Credit insurance protects the factoring client against the risks of bankruptcy. Paragon for almost 20 years has ensured their portfolio against bankruptcy, which in turn offers this layer of critical protection to their non-recourse clients. In addition, Paragon also offers recourse factoring for those clients not needing credit protection or having their own credit protection insurance in place.

About Paragon Financial Group
For 25 years, Paragon Financial Group has provided working capital solutions for growing companies throughout the U.S. They serve small to large-size companies across a wide variety of industries through accounts receivable, invoice factoring, and purchase order financing up to $3 million per month in volume. Paragon is a leading source for receivables financing, government contract financing, payroll funding, and purchase order financing. For more information, visit

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