NPDA Opposes Mandating Overtime for In-Home Companion Caregivers

Congresswoman Linda Sanchez (D-CA) introduced the Direct Care Workforce Empowerment Act last week. According to the National Private Duty Association’s (NPDA) blog, the association’s executive director, Kim Stoneking, issued a statement sharing the Act’s pros and cons with its member-base:

“NPDA supports some of the goals of the Direct Care Workforce Empowerment Act…NPDA member companies are committed to hiring and fielding a trained professional workforce of in-home companion care workers. NPDA also supports payment of at least minimum wage to in-home companion caregivers.”

However, “NPDA opposes mandating overtime for in-home companion caregivers” for the following reasons:

In some cases, caregivers spend the night in the homes of their clients. Making those overnight hours subject to overtime pay, many clients would not be able to pay for such a service. In addition, many seniors/people with disabilities usually prefer to have the same caregiver attend to their needs. “Restricting a caregiver’s work hours to no more than 8 hours/day or 40 hours/week could upset these essentially personal relationships, causing the senior/person with disability to have to settle for less care than they need, or to deal with more caregivers than they prefer.”

Click here to read more of NPDA’s thoughts on working with Rep. Sanchez and the Direct Care Workforce Empowerment Act.

Small Business Lending Fund and State Small Business Credit Initiative Blocked

TradingMarkets.com reported on the vote over the Small Business Lending Fund and State Small Business Credit Initiative today. Republicans blocked the small business bill with a 58-42 vote this morning.

The bill was intended to create the Small Business Lending Fund, which would set aside $30 billion to help local community banks get the capital they need to lend money to small businesses. In addition, the bill would help support small business initiatives run by states across the country that are struggling due to local budget cutbacks.

Click here to read the speech US Senator Patty Murray gave shortly before the vote.

United Way Names Cleveland Invoice Factoring Firm a 2010 Pacesetter

Taken from the official PRN Funding press release:

Last week, PRN Funding, LLC was recognized as a United Way 2010 Pacesetter. The Cleveland-based accounts receivable factoring firm was one of the first 84 companies to lock in their increased campaign donations to the United Way.

“PRN is pleased to be in a position to provide leadership assistance to support the United Way in fulfilling its crucial mission.”

The donations will be used to fund the 202 health and human service programs that help of 450,000 Greater Cleveland residents every year.

With years of experience in healthcare industry, PRN Funding has a precise understanding of the unique challenges within healthcare vendor industries. PRN Funding offers financial resources to these companies by purchasing their accounts receivable–a process known as ‘factoring’, which provides the cash needed to sustain and grow a healthcare business.

CFA Issues Statement to Fed’s Small Business Lending Conference

The Commercial Finance Association (CFA) issued the following statement to the Federal Reserve small business lending conference in regards to the importance of issuing funds to independent commercial finance companies:

“The Federal Reserve conference, [held on Monday, July 12] about increasing lending to small business is yet another example of political theater. Once again, our nation’s lawmakers have gathered to share vague ideas, point fingers and simply agree that the small business credit crunch continues.

“Disappointingly, no tangible solutions are being offered. The Commercial Finance Association continues to believe that providing support to independent commercial finance companies, a crucial source of capital for small businesses, is absolutely imperative. Independent commercial finance companies extended hundreds of billions of dollars to U.S. small businesses in 2009. Additionally, more than half of these lenders increased their credit commitments in 2009, during a time of severe economic distress, thereby enabling many U.S. businesses to survive. Our elected officials and our nation’s banks should remain committed to extending credit to independent finance companies. Doing so will set in motion a sequence of events that will allow these lenders in turn to provide additional funds to small businesses, allowing them to add jobs and make meaningful investments in their operations. This is a tangible, practical and needed step that will help fuel real economic recovery in America.”

How to Control Small Business Cash Flow

An informative article written by Max Newnham, entitled: Knuckle down on cash flow terms gives some practical advice for business owners who are struggling to keep a healthy cash flow.

For the benefit of our business owner readership, PRN Funding condensed the article down to it’s main points:

Too often, business owners focus primarily on sales and fail to administer and manage their companies appropriately. As a result, invoices oftentimes go out late, and there is rarely any follow-up on overdue invoices.

In order to prevent the above situation, small business owners should be upfront about payment terms and late-payment penalties before agreeing to take on new business.

Furthermore, companies should set credit limits for new accounts and monitor how much business is being done. If it jumps significantly, the payment terms should be re-visited and possibly re-negotiated.

Next, when it comes to collecting, small business owners will be more productive by making phone calls than sending out threatening letters or statements with stickers.

It’s comforting to know that out of all the suggested small business tactics for managing cash flow, PRN Funding is able to assist with each of these steps. Contact us today for more information on our invoice funding services.

Walmart Does All…Even Small Business Loans

Sam’s Club, a division of Wal-Mart Stores, Inc. announced yesterday that it is testing an online program with Superior Financial Group to offer small businesses loans between $5000-$25,000 to its members. The decision to offer these small business loans came as a result of a November 2009 survey, in which nearly 15 percent of Sam’s Club’s business owners reported being denied a loan to run their operation.

According to the official press release, “the Sam’s Club small business loan pilot program is a first-of-its kind and will complement other offerings that cater to small business including low rate merchant credit card processing, convenient order-ahead programs and early shopping hours.”

Sam’s Club members who apply for a small business loan will receive $100 off the application fee, a 20 percent discount and a 7.5 APR, which is a 25 basis point discount. (NOTE: The Sam’s Club Membership fee is $35/year.)

PRN Funding’s Take:
It’s a good thing that Wal-Mart is trying to fill a business loan gap with their pilot program, however, the loans are backed by the Nation’s leading Small Business Administration (SBA) lender. Therefore, there will still be stringent lending criteria that a small business owner will need to meet in order to qualify. This is bad news for brand new businesses and companies who have less than three years of operation.

Still, there’s hope, as small business owners can test out accounts receivable factoring to help fill in the cash flow gaps. Even if a small business owner has been turned down by a traditional lender, accounts receivable factoring firms will be able to fund them.

Healthcare Reform – 1099 Nightmare for Small Businesses

Last week, BusinessWeek published an article entitled: Health-Care Bill Surprise: 1099 Nightmare, and we thought the small business owners who read The Factoring Blog should be aware of its contents.

In essence, the article says: Small business owners should be aware of page 737 of the recently-approved healthcare reform bill, as it contains a three-paragraph provision, inserted by Democrats on the Senate Finance Committee to help offset the cost of the bill. In a nutshell, this insertion requires companies to report to the IRS payments of more than $600 a year to any vendor. The intent is noble: to capture $2 billion or more a year in taxes on income that currently goes unreported by contractors and small businesses.

Business advocates fear that the new rule will create a massive paperwork headache for small businesses because come 2012, the new rule will expand 1099-MISC reporting to include payments to companies, and for goods as well as services.

Read more here: Health-Care Bill Surprise: 1099 Nightmare.

Lingering Small Business Credit Crunch

Did anyone see the Wall Street Journal article: A Credit Crunch That Lingers earlier this week?

The reporter, Emily Maltby, wrote that even though the economy us “on the mend,” small business entrepreneurs are still struggling to land credit. She went on to discuss the myriad of explanations:

  1. Most of the government programs created to address the problem have been focusing primarily on Small Business Administration loans, which amount to just 10% of all small business lending.
  2. Some bankers claim that loan volumes are dwindling because the demand is down. These bankers say that business owners aren’t willing to take on more debt during these difficult times.
  3. Other bankers blame federal regulators for insisting that banks to be more prudent with lending.

Entrepreneurs are stuck in the middle of the finger-pointing debate with limited or no access to cash. Many of these small business owners are being forced to curtail their growth and hiring, which in turn, is slowing the nation’s recovery and keeping unemployment high.

The article highlighted Julio Valencia’s business, JTI Landing Systems because his somewhat new business has been turned down four times by larger banks. Exhausting his personal cash and retirement savings, Mr. Valencia struggles with cash flow, though not because of poor money management. Rather, his cash flow problems stem from slower-paying customers.

PRN Funding’s Take: Mr. Valencia and other small business owners who are struggling with poor cash flow should look into accounts receivable factoring as a lucrative alternative financing option.

2010 Small Business Credit Problems

The Gallup Organization conducted a survey in November-December 2009 for The National Federation of Independent Business Research Foundation (NFIB) of 751 small business employers (employing people 1-250) to help better understand the small business credit crisis.

Below are some of the survey’s key findings (as reported by The Secured Lender:

    1. 55% of small businesses attempted to borrow in 2009.
    2. 23% of those businesses were not able to have all of their credit needs met (which dropped significantly from earlier in the 2000s when up to 90% of businesses had their credit needs met).
    3. The financial institution extending a line of credit changed the terms/conditions of the line(s) during 2009 for 29% of small businesses.
    4. The most frequent “change” was increased interest rates for small businesses.
    5. The best predictors of success in meeting the credit needs were higher credit scores, customers of banks with less than $100 billion in assets, more properties collateralized for business purposes and fewer second mortgages held.
    6. Most common planned purpose of credit rejected was to fill cash flow needs. (SIDE NOTE: Payroll Funding and Invoice Factoring companies are used every day to fill cash flow needs.)

      Small Business Credit Conditions Tightest Ever

      Federal Reserve Chairman Ben Bernanke announced last week that banks need to restore a proper balance between making loans to creditworthy  borrowers and lending prudence.

      He clarified that banks have erred too far on the side of caution since the beginning of the financial crisis, and as a result, “credit conditions for small business are the tightest they have been in recent memory.”

      Click here to see the entire story: Bernanke: Small Business Lending Tightest in Recent Memory.

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