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 | Funding as fast as 24 hours (subject to approval) | Bridging seasonal slow periods |
| MCA → | $5,000 – $2,000,000 | 3 – 18 months | Funding as fast as 24 hours (subject to approval) | 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.
Business funding in as little as 24 hours
Ready to see what you qualify for?
Free to apply. No upfront fees. Available to qualified applicants with a complete file; timing varies by funding provider.
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
- Funding as fast as 24 hours (subject to approval)
Merchant Cash Advance
Fast capital based on future receivables
- Amount
- $5,000 – $2,000,000
- Speed
- Funding as fast as 24 hours (subject to approval)
Industries that use Factoring
See how Factoring fits the cash-flow needs of each industry participating funding providers fund.
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.