What it is
Not a loan. You send invoices. The factor advances against them and collects from your customer on the terms in the agreement. Because collection runs through your customer, that customer's credit is part of the file.
Invoice factoring
Cash against invoices. Not a loan.
- Structure
- Invoices are purchased
- What matters
- Your customer's credit
- Cash comes from
- The invoice
Working capital
A lump you pay back.
- Structure
- Amount advanced to you
- What matters
- How the business runs
- Cash comes from
- The program
When it fits
You invoice other businesses on terms, those invoices are unpaid, and you would rather not wait on the customer's clock.
It does not fit card-only retail with no invoices, and it is not a building loan.
What we need to start
An accounts receivable aging and sample invoices. Who your customers are matters here.
What happens next
Submit one application. We package the file and send it to lenders that buy this kind of paper. Options appear in your account when they exist. Sometimes more than one, sometimes none. You compare terms there, pick an option if you want one, and still review that lender's agreement before you sign.