Invoice Factoring
Leverage your unpaid invoices to generate cash flow for your business without creating debt
Invoice factoring (accounts receivable factoring) converts B2B or B2G invoices into working capital by selling selected invoices at a small discount, instead of waiting 30, 60, or 90 days for payment. Once the account is set up, advances on approved invoices are often available within 1–2 days. It is not a traditional loan, so companies do not increase debt. i95 Capital structures and places factoring facilities with specialty funders so companies can cover payroll, fulfill orders, and grow without waiting on customer payment terms.
Flexible Terms to Maximize Your Opportunity
Advance Amount
Up to $15M monthly
Agreement Term
1 Year Renewable
Discount Rate
Approx. 0.8%-3%/month
Advance rates are typically 80%–95% of invoice face value. The reserve (the rest, less the factoring fee) is released when the customer pays. Pricing depends on receivable quality, customer credit, concentration, and aging.
How rates, reserves, and billing periods work is in How Invoice Factoring Works and What It Costs.
Who Uses Invoice Factoring
Invoice factoring fits companies that issue invoices to other businesses or government and need cash before those invoices are paid. It is common in staffing, trucking, manufacturing, wholesale, professional services, and other B2B operators with creditworthy customers.
Typical situations include payroll timing, large orders, seasonal gaps, and growth that outruns collections. i95 Capital works with funders across a wide range of program sizes and offers invoice factoring in all 50 US states.
When Invoice Factoring Makes Sense
- Make payroll before customer payments arrive
- Take advantage of early payment discounts
- Fulfill large orders without waiting for payment
- Bridge seasonal cash flow gaps
- Fund growth that outpaces customer payments
- Stock up for seasonal demand
Invoice Factoring Compared with Other Options
Factoring and a bank line
A bank line is revolving debt based on your credit and covenants. Factoring is the sale of selected invoices. Approval leans more on customer credit and invoice quality than on a full traditional loan package.
Factoring and asset-based lending (ABL)
ABL is usually a revolving facility secured by AR (and often inventory or other assets) without selling the invoices. Factoring sells invoices for speed on specific receivables. Asset-based lending can fit better when you want an ongoing borrowing base rather than invoice-by-invoice sales.
Factoring and a term loan
A term loan funds a fixed amount and amortizes over time. Factoring tracks invoices you choose to sell and can scale with sales volume.
How Lenders Evaluate Invoice Factoring Requests
Factors focus first on the customers who owe the invoices: credit quality, invoice aging, and concentration. Diversified AR from creditworthy customers with normal payment terms usually supports better advances and fees than heavy concentration or old invoices.
Your company’s profile still matters, but as support. Funders want real completed work, clean books, and few disputes or offsets. A current AR aging and clear invoice backup speed approval.
Concentration is a main risk check: one customer as a large share of factored volume raises exposure and can tighten terms.
How Invoice Factoring Works
After review, you receive offers with advance and fee structure. You choose a program and complete an accounts receivable purchase agreement. First-time setup often takes a few days.
You then submit invoices you want to factor. On approved invoices, the funder advances a large share of face value (often about 80%–95%) to your business account, commonly within a day. When your customer pays, the remaining reserve, less the factoring fee, is released to you.
Frequently Asked Questions
What is invoice factoring?
Selling selected B2B or B2G invoices at a discount for faster cash instead of waiting on customer payment terms. It is not a traditional bank loan.
What advance rates and fees are typical?
Advances are often about 80%–95% of invoice value. Fees vary with customer credit, aging, volume, and concentration. Your rate is set in underwriting, not as one fixed public number.
Do my customers know?
Many programs are disclosed (the customer pays the factor). Some structures are less visible; what applies depends on the funder and the offer. We will flag requirements on each option.
How is factoring different from ABL?
Factoring sells invoices. ABL is typically a revolving line secured by AR and sometimes other assets, without selling each invoice. See asset-based lending.
What size programs does i95 Capital handle?
We work across a wide range of factoring sizes with specialty funders. Fit depends on invoice quality, customers, and volume.
What to Have Ready
Lenders move faster when the file is complete. For a factoring discussion, it helps to have:
- Current accounts receivable aging
- Sample invoices and related backup
- Customer list or concentration picture
- Basic company information and recent financials (as requested)
- Business bank statements (often recent months)
Exact items vary by funder. For a one-page list, contact us.
How to Get Started with Invoice Factoring?
Apply on your own
- Start the application process by completing the invoice factoring online application and submitting copies of your aging Accounts Receivable report.
- The application is easy and without commitment.
Or, we can assist
- Complete our contact form and select Application Assistance in the Inquiry Type, and a representative will call you promptly. i95 Capital assists you every step of the way.
Either way, after receiving your completed financing application, our advisors will promptly review the information and the documents you included and submit the file for processing.
