American River Bank

Asset-Based Lines of Credit

Are you looking for the right formula for growth and profitability? An asset-based line of credit will allow your business to take advantage of growth opportunities and at the same time, relieve the pressure of meeting an "out-of-debt" period often required on traditional revolving lines of credit. 

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An Asset-Based Line works well for:
  • Wholesalers and distributors
  • Manufacturers
  • Businesses with cash tied up in receivables and inventory

Features and Benefits
  • Access to a larger limit than a traditional line of credit 
  • Revolving based on accounts receivable and inventory balances 
  • Advance rates up to 80% of eligible receivables 
  • Inventory advance may be available on a limited basis
  • Optional daily sweep arrangement reduces monthly interest costs 
  • No ”out of debt” period required

  • Minimum (3) three years in business
  • Profitable operations
  • American River Bank deposit relationship

An Asset-Based Line of Credit vs. a Factoring Company
Typically, a factoring company will take ownership of the receivables and collect them on behalf of the borrower. An asset-based line of credit uses the receivables as collateral but the company retains ownership of the receivables and manages the collection process.

A factoring company will typically charge a large upfront fee and a discount rate based upon how many days the receivable is outstanding, whereas an asset-based line typically charges an interest rate payable monthly based upon the total amount outstanding on the line. The cost savings can be substantial, especially if there are any delays in collecting the borrowers' receivables.

Also, American River Bank offers the borrower the option to automatically make transfers to and from their checking account or line on a daily basis through a sweep arrangement, thereby reducing monthly interest costs.

Lending Area
American River Bank serves clients throughout Northern California, including Sacramento, Roseville, Santa Rosa, Healdsburg, Jackson, Pleasanton and San Jose (Greater Sacramento Area, Sonoma County, Amador County, San Francisco Bay Area - South Bay, North Bay, and East Bay).

*Ineligible receivables include accounts aged more than 90 days from invoice date, foreign or U.S. government receivables and any portion of a receivable that accounts for more than 20% of the total accounts receivable balance.