Freight Broker Factoring: The Interstate Capital Advantage
From the outside, freight brokers have one overarching goal: matching shippers’ loads to available drivers. However, behind the scenes, their job is one of the most complex, most demanding in the transportation industry. Brokers stay very busy juggling customers, motor carriers, routes, equipment, weather conditions, deadlines, and especially finances. All these moving parts of the process are challenging, but paying drivers and paying for fuel can quickly become a broker’s major concern when shippers and consignees don’t pay them for 30, 45, or even 60 days.
Interstate Capital has years of experience helping freight brokers stay on top of their challenges and succeed in the logistics industry. This expertise in freight broker factoring has led to the development of Interstate Capital’s revolutionary proprietary payment management system, Freight Payable Systems (FPS). FPS matches the broker’s accounts receivable due from the shipper through the freight broker and finally to the carrier that hauled the freight and delivered it. At the same time, the system efficiently handles all the paperwork, invoices, bills, and automatic payments to drivers.
Factoring with Interstate Capital allows freight brokers to focus their time on what they do best: keeping their freight moving and drivers on the road.
The FPS software, managed minute-to-minute by the trained FPS team, helps brokers by “setting aside” and ensuring that the cash coming in from a shipment gets paid to the right carrier. The freight broker forwards to the carrier the payment amount due, and the difference, or broker’s commission, is retained by the broker as its payment for arranging the transaction. Through FPS, the carrier will be paid electronically within 48 hours via ACH transfer.
So many freight brokers get into trouble when they receive a payment for a load and use those funds for something other than paying the corresponding carrier. When it comes time to pay the carrier, the freight broker is then in the position of having to use the proceeds from a new transaction to pay the outstanding fee. When brokers factor with Interstate Capital, FPS helps to avoid this predicament. Freight brokers must, according to the Federal Motor Carrier Safety Administration, maintain records that segregate funds payable to carriers from their general operating funds. FPS helps freight brokers remain in compliance with federal regulations.
FPS is the only online freight broker factoring system designed exclusively for the freight brokerage industry and is available only to freight brokers who factor accounts receivable with Interstate Capital, at no additional cost! This system, combined with Interstate Capital’s dedicated freight broker factoring account managers and team of financial professionals, gives freight brokers the edge they need to get ahead and stay ahead.