How Can Disbursement Funding Work for Your Business?

Law firms that offer no win, no fee agreements on personal injury matters carry substantial outlays in the form of unbilled disbursements, usually to cover the costs of medical and other expert reports, filing fees, and other necessary expenses. 

Based on Providior data, we typically see that for every PI practitioner, a firm carries anywhere from $200-$350k in disbursements at any one time. This means that for a 4 practitioner firm, it is not uncommon for that number to be up to $1.4m – a substantial burden on a firm’s cash flow.

What is Disbursement Funding?

Disbursement funding is a form of litigation funding that helps a firm to preserve their valuable cash flow for investment in ongoing growth of the business and enabling healthy growth in open files. It does this by carrying outlays/unbilled disbursements in no win, no fee, personal injury matters.

The Disbursement Funding Process

When invoices from medico-legal providers or other eligible suppliers are issued, these are uploaded into the Providior portal and are paid on the law firm’s behalf.

Each disbursement is issued as an individual loan, grouped under a matter reference for ease of reporting.

The entire amount of the disbursement and any applicable fees and interest are carried to term so there is no monthly servicing of the loan facility required.

Interest is calculated daily and accrued to the end of the loan term. This can be either the settlement date or the agreed loan term – whichever comes first.

Where the settlement occurs prior to the end of the maximum loan term, interest is only charged to that date and is non-compounding.

Payout statements are available at any time in preparation for conferences and hearings.

Providior can share best practice knowledge on how to include disclosures around the presence and availability of funding to claimants in a firm’s Costs Agreement so that there is complete transparency in the process, avoiding any adverse feedback from claimants.

There is no constraint on the selection of specialists, suppliers or vendors. Providior simply processes payment on valid disbursements.

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Why Would a Personal Injuries Law Firm Use Disbursement Funding?

In many cases, personal injury matters such as motor vehicle accidents, medical negligence, or workers’ compensation can last for years, meaning that for a firm that is internally funding these disbursements, there is a significant amount of cash trapped in the balance sheet. 

With the burden of disbursements carried by Providior, the firm can invest a greater portion of their cash flow in business growth.

What Can Unlocked Cash Be Used For?

Disbursement funding can unlock trapped cash to put towards a range of business expenses, from tax bills to technology and more. These funds can allow you to invest in:

  • The execution of a marketing strategy to grow awareness of the brand and to bring an ongoing flow of new work to the business.

  • Capacity through hiring and development of talent to enable the firm to carry more files and to increase file velocity.

  • Investment in technology to optimise the productivity of the business and the quality of the work completed.

  • Supporting a succession plan that might include equity exchanges between incoming and outgoing partners.

  • An orderly approach to end of financial year planning.

In short, disbursement funding allows you to unlock that trapped cash to ease your cash flow pressures and support the growth of the business.

Why Choose Providior?

  • Our application process is streamlined and takes into account the irregular nature of PI firms’ revenue.
  • We do not limit your choice of supplier/vendor or specialist.
  • We offer a seamless experience for submission and same-day payment of vendor invoices and a real-time dashboard to be able to see your funded matters at any time.
  • Providior is a privately held firm, founded by those with a deep understanding of PI law firms.
  • We are a lean team of skilled professionals, focused on building and maintaining close relationships with our clients to be able to support them through the ups and downs of business.
  • Providior is adept at coordinating with banks and other financiers to ensure that the presence of our specialist financing tools can co-exist with other forms of financing that a business requires.

Ready to Talk?

We’re just a phone call or email away and would love to hear from you. Contact us today to discuss your business and funding needs.

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