• Quick Access to Capital: ABL allows healthcare providers to obtain funds rapidly by using their assets as collateral, which is ideal for addressing urgent cash flow needs or seizing growth opportunities.
• Flexibility: Unlike traditional loans, ABL offers increased flexibility based on available assets. This allows healthcare practices to manage their financing according to their specific situation and liquidity needs.
• Less Reliance on Personal Credit: Since the loan is secured by the company’s assets, personal or business credit history is not the main evaluation criteria. This enables healthcare providers with less favorable credit to still obtain financing.
• Asset Optimization: Healthcare providers can leverage their existing assets (such as receivables and inventory) to obtain funding, optimizing the value of these assets rather than leaving them unused.
• Support for Growth and Expansion: ABL can provide the resources needed to finance expansion projects, purchase new equipment, or improve facilities, thereby contributing to business growth.
• Improved Cash Flow Management: By using assets to secure loans, healthcare providers can better manage their cash flow and maintain smooth daily operations.

Asset-based lending is suitable for healthcare providers of all sizes, including medical practices, clinics, hospitals, and other healthcare-related businesses. It is particularly beneficial for companies in sectors such as biotechnology, pharmaceuticals, medical devices, diagnostics, healthcare IT, and life sciences that have valuable assets to leverage.

The approval and disbursement process for asset-based lending is typically faster than traditional loans. Once the assets are evaluated and the loan is approved, funds can be available within a few days to a couple of weeks, depending on the complexity of the assets and the lender’s processes.

Common assets used as collateral in asset-based lending include accounts receivable, inventory, medical equipment, and other valuable property owned by the healthcare provider. The specific assets that can be used depend on the lender’s criteria and the value of the assets.

The loan amount is typically a percentage of the appraised value of the assets used as collateral. This percentage, known as the loan-to-value ratio, varies based on the type of assets and the lender’s policies. Generally, accounts receivable may secure a higher percentage compared to inventory or equipment.

As with any financing option, asset-based lending carries risks. If the borrower defaults on the loan, the lender can seize the assets used as collateral. Additionally, regular evaluations of the assets are required to maintain the loan, which can be an administrative burden.

Yes, asset-based lending can be combined with other financing options such as invoice factoring, traditional loans, or lines of credit. Combining financing solutions can provide a comprehensive approach to meeting your healthcare practice’s financial needs.

To get started with asset-based lending, contact Finmed Capital. Our team of experts will guide you through the process, assess your assets, and provide personalized financial solutions tailored to your healthcare practice.