Factoring
Invoice Factoring
Turn unpaid invoices into immediate cash.
Invoice factoring lets you sell outstanding B2B invoices for immediate cash — typically 80–95% upfront and the remainder (minus fees) when your customer pays. Simply Approved Business Loans factors invoices from $10,000 to $10,000,000 with same-day funding and no minimum credit score.
Best for
- B2B businesses with net-30/60/90 terms
- Staffing, trucking, and manufacturing
- Companies waiting on slow-pay customers
- Startups without traditional credit history
Key features
- 80–95% advance rate on invoices
- Approval based on customer credit
- No long-term contracts (spot factoring available)
- Recourse and non-recourse options
- Same-day funding on approved invoices
How Factoring works
Factoring is the sale of B2B invoices to a third-party (the factor) at a discount. You receive 80–95% of invoice face value within 24 hours; the factor collects from your customer and remits the remaining balance (minus a fee) when paid.
Approval is based on your customer's credit, not yours. That's why factoring works for startups, bad-credit borrowers, and businesses with thin operating history — as long as your customers are creditworthy B2B buyers.
Two structures: recourse (you repay if the buyer defaults; cheaper) and non-recourse (the factor absorbs default risk; more expensive). Most freight and staffing factoring is recourse; manufacturing tends toward non-recourse.
Qualifications
| Customer credit | Creditworthy B2B buyers |
| Min monthly invoice volume | $10,000+ |
| Min FICO | No minimum (buyer-credit underwriting) |
| Documents | Aging report + sample invoices + customer list |
Pros
- Same-day funding on delivered invoices
- Approval based on buyer credit, not yours
- No debt added to balance sheet (sale, not loan)
- Scales with revenue — fund more as you grow
- Spot factoring available — no long-term commitment
Cons
- •Recurring fees compound across many invoices
- •Customer concentration (>30% one buyer) tightens terms
- •Buyer pays the factor directly — some customers dislike this
- •Recourse factoring puts default risk on you
Common mistakes to avoid
- Locking into a long contract with monthly minimums
Many factors push 1–2 year contracts with minimum-volume penalties. Spot or month-to-month is far more flexible.
- Factoring slow-pay customers without negotiating terms
Sometimes a frank conversation with a slow-pay buyer (or a 1% early-pay discount) is cheaper than factoring.
- Hiding factoring from customers
Some customers prefer not to deal with a factor. Always communicate clearly; most are fine if introduced professionally.
Real-world scenarios
A 6-truck fleet factors freight bills at 2.5%, getting same-day cash on delivered loads instead of waiting 38 days for broker pay.
A staffing agency with $2M/mo in placements factors AR weekly at 2%, funding payroll without bank LOC drawdowns.
When another product is a better fit
- Business Line of Credit →
If you have stronger credit and want lower-cost revolving access.
- Working Capital Loans →
If your AR is small relative to total cash needs.
- Merchant Cash Advance →
If your revenue comes from card sales rather than B2B invoices.
How to apply
- 01
Submit your aging report and sample invoices
- 02
Receive a factoring schedule and rate quote
- 03
Sell invoices and receive 80–95% upfront
- 04
Customer pays the factor; you get the remainder less fees
Factoring vs. other funding options
Side-by-side comparison of Factoring against the most common alternatives. Use this to decide which structure fits your business stage, cash flow, and use of funds.
| Product | Amount | Term | Speed | Best for |
|---|---|---|---|---|
| Factoring This page | $10,000 – $10,000,000 | 30 – 90 days per invoice | Funded same day | B2B businesses with net-30/60/90 terms |
| Line of Credit → | $10,000 – $1,000,000 | Revolving | Approved in 1–3 days | Managing cash flow gaps |
| Working Capital → | $5,000 – $1,000,000 | 3 – 24 months | Funded in 24 hours | Bridging seasonal slow periods |
| MCA → | $5,000 – $2,000,000 | 3 – 18 months | Funded in 24 hours | Restaurants & retail with daily card sales |
FAQs about Factoring
Lead-gen pre-check
See if you qualify for Factoring
$10,000 – $10,000,000 · Funded same day. Pre-qualification is free and doesn't affect your credit.
Free pre-check
Eligibility checker
No credit pull. No data stored. Instant answer.
Underwriting disclaimer: The eligibility checker is a self-reported pre-qualification tool. It does not constitute an offer of credit or a guarantee of approval. Every funded file goes through full underwriting — including bank statement analysis, business verification, and a credit inquiry whose type (soft or hard) is disclosed before you sign. Final terms, rates, and amounts depend on underwriting and the specific lender or program.
Apply now — funded in 24 hours
Free to apply. No upfront fees. Real underwriters review every file.
Related products
Business Line of Credit
Revolving capital you can draw on demand
- Amount
- $10,000 – $1,000,000
- Speed
- Approved in 1–3 days
Working Capital Loans
Cover payroll, inventory, and day-to-day expenses
- Amount
- $5,000 – $1,000,000
- Speed
- Funded in 24 hours
Merchant Cash Advance
Fast capital based on future receivables
- Amount
- $5,000 – $2,000,000
- Speed
- Funded in 24 hours
Get funded in as little as 24 hours
$5,000 to $25,000,000. Free pre-qualification. No upfront fees. Same-day decisions for clean files.