Unlock cash tied up in eligible invoices
Turn unpaid business invoices into working cash.
Learn how invoice factoring can help business to business companies bridge the time between delivering work and getting paid.
Find My Funding OptionsUnderstand the structure
How invoice factoring works.
Invoice factoring allows a business to sell eligible customer invoices to a factoring company. The business receives an advance, and the remaining balance, less the agreed fee, is released according to the factoring arrangement after the customer pays.
Factoring focuses heavily on the quality of the invoices and the customers that owe them. It is not the same as a conventional loan, and the factoring company may communicate directly with customers. Review notice, collection, recourse and reserve terms before proceeding.
A practical process
Prepare before you apply.
Submit eligible invoices
The factor reviews the invoice, customer, payment terms and proof that the work was completed.
Receive an advance
If approved, a percentage of the invoice value is advanced to the business.
Complete the settlement
After the customer pays, the reserve is settled according to the agreement and fees.
Compare with care
What to review before accepting.
Advance and reserve
Know how much is advanced now and what remains held until payment.
Recourse
Understand who carries the risk if the customer does not pay.
Customer experience
Review how notices, verification and collections will be handled.
Common questions
Invoice Factoring FAQ
Is invoice factoring a loan?
Generally, factoring is the purchase of eligible receivables rather than a conventional loan, though legal treatment and terms can vary.
What businesses use factoring?
It is common in trucking, staffing, manufacturing, distribution, business services and other industries that invoice creditworthy commercial customers.
Will customers know invoices were factored?
Often yes, because payment instructions or verification may change. Review the customer communication process before signing.