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The Best Invoice Factoring Companies in 2020

Amid growing economic uncertainty, some businesses are finding it increasingly difficult to access cash. For many B2B companies, the best solution is invoice factoring or the sale of unpaid invoices. This form of financing offers numerous advantages, especially for businesses that need money quickly but aren’t able to secure a conventional bank loan. Factoring enables you to take better control of your finances, pay your employees on time, and take advantage of any investment opportunities.

Read our reviews of some of the best invoice factoring companies and learn more about this type of financing.

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Top-Rated Factoring Companies - Top 3 Picks

Top 3 Picks

BlueVine

Easy to apply

Flexible invoice factoring terms

Up to 90% of the invoice amount

Visit Site READ REVIEW

Triumph Business Capital

Accepts your application within 24 hours

Knowledgeable staff

Recourse and non-recourse factoring

Visit Site READ REVIEW

Breakout Capital

Loan amount up to $1,000,000

Daily, weekly, or monthly rates

No penalties for paying off debt early

Visit Site READ REVIEW

The 4 Best Invoice Factoring Companies

1. BlueVine

BlueVine is one of the most reputable business factoring companies on the market. It’s the best choice for B2B companies that work with large corporations and need quick access to cash to cover costs or make investments. The company holds an impressive A+ rating on the BBB, while hundreds of online reviews praise its quick and straightforward services. In addition, BlueVine doesn’t place any restrictions on the types and number of invoices you can sell. You can also cancel your account at BlueVine without any cancellation fees. READ REVIEW

Easy to apply

Flexible invoice factoring terms

Up to 90% of the invoice amount

Visit Site

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Minimum credit score:

530

Loan amount:

Between 85% to 90% of invoices

Minimum time in business:

3 months

Minimum revenue:

$100,000

Factoring rates start at:

0.25%

Loan terms:

1-13 weeks

Funding time:

Up to 24 hours

2. Triumph Business Capital

Founded in 2004, this company offers various financial products to its clients, including asset-based lending, equipment purchasing, and insurance. Triumph Business Capital is among the best trucking and freight factoring companies. More than 7,000 businesses have already used its services, with many applauding the company’s polite and knowledgeable team. Invoice funding with this lender is suitable for both small and large businesses. The company also offers recourse and non-recourse invoice factoring. READ REVIEW

Accepts your application within 24 hours

Knowledgeable staff

Recourse and non-recourse factoring

Visit Site

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Minimum credit score:

500

Loan amount:

N/A

Minimum time in business:

N/A

Minimum revenue:

$100,000 annually

Factoring rates start at:

N/A

Loan terms:

N/A

Funding time:

24-48 hours

3. Breakout Capital

Breakout Capital differs from other factoring receivables companies because it offers a unique solution for selling accounts receivable. Its blended product, Factor Advantage, works with both invoice factoring and business loans. Customers praise the provider’s low credit score requirements and extremely polite customer support. The company’s agents are also trained to give financial advice, so you can get the best support while choosing the right type of funding for your business needs. READ REVIEW

Loan amount up to $1,000,000

Daily, weekly, or monthly rates

No penalties for paying off debt early

Visit Site

show more


Minimum credit score:

N/A

Loan amount:

Up to 1,000,000

Minimum time in business:

N/A

Minimum revenue:

N/A

Factoring rates start at:

1.25%

Loan terms:

Up to 2 years

Funding time:

N/A

4. Nav

Nav acts as a middleman between borrowers and online lenders. Thanks to its collaboration with numerous entities, Nav can help you find the best factoring company for your business. The company also offers credit score tracking and monitoring services. As such, it can help you improve your FICO and allows you to apply for invoice factoring with better repayment terms. READ REVIEW

Secure online service

MatchFactor tools

Various financial products

Visit Site

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Minimum credit score:

N/A

Loan amount:

50% to 80%

Minimum time in business:

N/A

Minimum revenue:

N/A

Factoring rates start at:

3%

Loan terms:

Depends on when your customer pays

Funding time:

24 hours

How We Evaluate Invoice Factoring Companies

Invoice factoring is widely used by many businesses. Wholesalers, freight brokers, and many B2B companies use factoring services for different reasons. Some need the money for rent, utility bills, and to pay salaries. For others, invoice factoring is the fastest way to get cash for investment opportunities.

Numerous online lenders act as factoring firms. In order to identify the best invoice factoring providers, we evaluate each of the companies thoroughly based on the following criteria.

Application Process and Funding Time

One of the best things about invoice discounting companies is that you can complete the whole application process in less than a day. Aside from your personal details and information about your company, you don’t need to offer any additional data. Some companies will check your credit score and ask if you have a driver’s license, but that’s it.

You can complete the entire process online, and that’s why we look for sites that are easy to navigate and have a clear UI. We also check to see if you can submit your application using a mobile device. Integration with your accounting software is also a great option to have so you can transfer invoices automatically.

Finally, top factoring companies should be capable of quickly transferring the money into your account. It usually takes one business day, but the best providers can complete the whole transaction in 10 minutes.

Flexibility

In most cases, the lender will allow you to choose which invoices you want to factor, but there are exceptions. Some lenders might demand that you sell all invoices from a particular client. Also, a lender may request invoices from a certain time period or limit the number of invoices you can sell.

Payment and Discount Rates

Our list of factoring companies includes providers that offer the best price for your invoices. There are no companies that pay the full amount for invoices, but the best ones offer up to 99% of the invoice value. Meanwhile, discount rates range between 1% and 6%. The final amount depends on numerous factors, like how long it takes your client to pay off the debt.

Contract Length

Another thing to keep an eye out for is the length of the contract. Different financial factoring companies offer different contracts. In most cases, these are monthly or annual subscriptions.

Recourse and Non-Recourse Factoring

There are two types of invoice factoring: recourse and non-recourse factoring. Most companies offer the first type of service. Recourse factoring is a low-risk investment because the client is required to buy back the unpaid invoices from the factor.

With non-recourse factoring, the factor is responsible for absorbing the unpaid bills. If you choose this method, you should expect high accounts receivable factoring rates because the factor is taking a greater risk.

Other Financial Products

While reviewing the companies, we take note of some of the other services they provide. The largest factoring companies offer small business loans, lines of credits, and other financial products. Some specialize in offering financial advice to clients, while others provide different tools for monitoring and improving your credit score.

Security

Lastly, we examine the level of security. Online factoring can be a risky process if you are doing it through companies that can’t guarantee privacy, safeguard your personal details, and ensure secure transactions.

The Best Invoice Factoring Companies in 2020:

  • BlueVine

  • Triumph Business Capital

  • Breakout Capital

  • Nav

Every credible list of the best invoice factoring companies includes the name BlueVine. There are more than 125,000 satisfied small business owners that have used BlueVine’s financial services, including loans, lines of credit, and invoice factoring. When it comes to invoice factoring, BlueVine is the best choice for businesses that need large credit limits. You can get a credit line of up to $5 million.

Application Process and Funding Time

Countless BlueVine reviews illustrate the level of satisfaction with the simplicity and the speed of the company’s application process. In addition to providing your monthly revenue, credit score, and years in business, you’ll also need to prove that your business is a B2B company. Of course, you’ll also have to provide details about the invoices you want to sell.

Just like many other accounts receivables factoring companies, BlueVine allows you to submit your invoices through the online dashboard. If you’re already using accounting software like QuickBooks, you can do that automatically. It usually takes one business day for BlueVine to process your application, after which you can expect the funds on your account instantly.

To make transactions easier, the company provides its clients with a lockbox service. The downside here is the additional cost because bank lockboxes come with monthly fees.

Terms of Service

BlueVine is one of those invoice funding companies that doesn’t place any restrictions on the invoices you can factor. You’re free to choose which invoices you want to sell, giving you more control over your finances. But the minimum value of the invoice must be $500.

BlueVine is a recourse invoice factoring lender, meaning that you’re fully responsible for your clients’ unpaid invoices. As a solution for businesses that are struggling with unpaid invoices, BlueVine offers installment loans. Borrowing might not be the best option, but in situations like this, it’s often the smartest choice.

Invoice Factoring Rates

If you decide to use the online invoice factoring service at BlueVine, you’ll be greeted with highly affordable rates. Rates start at 0.25%, which is charged each week. You don’t need to sign long-term contracts, which means that you can cancel your arrangement with BlueVine as soon as your clients pay their invoices.

BlueVine invoice factoring doesn’t include any termination fees. However, there are additional fees in case your clients pay late. The late fee is between 2% and 3%, and there are additional penalties of 0.2% to 0.3% for each additional day that the payments are late.

Final Thoughts

BlueVine is undoubtedly one of the best factoring companies for most B2B firms. We really liked the transparency of the lender’s application requirements and factoring rates. You can get up to 90% of the invoice value and have the money in your account within 24 hours.

Reasons to Apply

Affordable invoice factoring rate

Integration with accounting software

No restrictions on invoices you want to sell

No long-term contracts

No termination fees

Triumph Business Capital is one of the better-known publicly traded factoring companies. A broad range of industries use its services, including trucking, freight brokers, and government contractors.

According to user reviews on the company’s website, Triumph Business Capital has a very helpful and polite team, as well as a fast online application process. The Triumph factoring company supports both small and medium-size businesses.

Application Process and Funding Time

Triumph factoring is a great option for businesses that don’t always have the luxury of waiting for their clients to pay their bills. Typically, clients can prolong the payment process by up to 90 days or longer. But salaries, rent, and other bills can’t wait that long. That’s why many businesses turn to this fast invoice discounting service.

The online application requires the following information: your company’s organizational documents, annual report, and an example of the invoices you want to sell. Thanks to the company’s fast and responsive agents, you can expect an answer to your request within one business day.

But there is one notable downside. Although the company doesn’t have any requirements regarding how long you’ve been in business, Triumph Business Capital will do a credit check. It performs a hard credit pull, which will affect your credit score.

Terms of Service

Triumph is among the receivable financing companies that offer both types of invoice factoring: recourse and non-recourse. If you’re not sure which option is best for you, the company’s representatives will be happy to assist you.

Generally, non-recourse factoring is a good option if you have a small business that is struggling with unpaid invoices. Non-recourse factoring means higher rates, but it provides instant cash.

For midsize and large companies, recourse factoring is a smarter option. In case your client doesn’t pay the debt, you need to have sufficient capital to cover it.

Just like some of the other companies that provide top invoice finance services, Triumph requires that you sell all invoices linked to an individual client. This practice is designed to avoid confusion with payments.

Invoice Factoring Rates

The company doesn’t display details on its website about the amount you get for your invoices. The rates are calculated based on several factors, including the amount of time it takes your clients to pay. The rates can be flat or vary on a monthly basis.

Final Thoughts

Triumph is one of the best factoring companies for trucking, freight brokers, and government contractors. In addition to invoice factoring, Triumph offers financial services for equipment purchases, insurance, and loans.

Reasons to Apply

Fast application process

Offers both types of invoice factoring

Knowledgeable and polite team

Various financial products

Tracks the status of your order on any device

Launched in 2015, Breakout Capital is an online lender that specializes in providing financial support to small businesses. According to online reviews, it’s one of the most reputable factoring companies for small businesses.

Clients praise Breakout Capital for its flexible repayment terms as well as its knowledgeable support agents. It holds an impressive BBB rating of A+, while on TrustPilot the company has a score of 9.6/10.

Application Process and Funding Time

Just like some of the other factoring companies on our list, Breakout Capital enables you to apply directly from the company’s site. You’ll need to provide basic information about your business, including your name, address, email, and the type of business you run.

You’ll also be asked about the amount you want to borrow. If you have any questions, you can contact the company’s skilled customer support team.

One of the reasons why Breakout Capital is among the best-rated factoring companies is its low credit score requirements. You don’t need to have a perfect credit score to use the company’s products.

Terms of Service

Breakout Capital has a specific business financial factoring product called Factor Advantage, which works with both short term loans and invoice factoring. It’s a great solution for businesses that aren’t eligible for factoring services at other lenders. Breakout Capital offers factoring loans in advance, even if your invoices aren’t yet factored.

Factor Advantage is a good solution for businesses that need money instantly to overcome financial difficulties or pay monthly bills.

Invoice Factoring Rates

This receivables factoring company doesn’t display any figures on its website about the amounts you get for selling your invoices. The company clearly states that loans are customized to fit the needs of each individual client. The same goes for factoring rates. Although the rate starts at 1.25% per month, in reality it varies depending on the client’s situation.

The loan term cannot be longer than 12 months, and you can choose from daily, weekly, or monthly rates. During this period, your factoring rate can change.

To calculate your rates, you can also use SmartBox, a comparison tool designed to give you a better understanding of each of the company’s financial products.

Unlike some of its competitors, this accounts receivable factoring company doesn’t charge penalties if you pay off your debt early. In addition, clients who don’t miss payments and who are able to pay off their debt early can get a discount.

Final Thoughts

If you have clients who pay regularly, the company’s Factor Advantage program is a good option. You’ll get fixed repayment terms and a discount if you pay off your debt early.

Reasons to Apply

No credit score required

Responsive customer support

Various financial products and tools

No penalties for paying off debt early

Loan amount up to $1,000,000

Nav is not a direct lender but a matchmaker that connects borrowers with suitable online lenders and credit card companies. More than 110,000 businesses across the US have used its services to find the best funding option. If your small business is looking for factoring companies but you’re not sure where to start, Nav is the perfect choice.

Application Process and Funding Time

Finding a good factor can be a daunting task. Each of the companies has certain criteria that you need to fulfill. If your business doesn’t meet these requirements, your application might be rejected. But with Nav’s MatchFactor tool, you’re 3.5 times more likely to get approved.

MatchFactor is a powerful tool that quickly scans hundreds of lenders and finds the one that fits you best. With Nav, you don’t need to worry if you have a poor credit score or low monthly revenue. Nav has a huge base of invoice financing companies, and one of them is bound to accept your request.

Terms of Service

Since Nav is an online marketplace, the terms of the invoice factoring depend on individual lenders. However, there are some things that Nav guarantees. For example, you can expect to get between 50% and 80% of the invoice amount.

The amount you get depends on various factors. For example, some lenders will give you less if you have a poor credit score. Others will check the invoice to see if your customer is creditworthy.

Invoice Factoring Rates

Accounts receivable factoring companies buy your invoices at a discounted rate. Companies that collaborate with Nav charge a factoring fee that ranges between 3% and 5% of the total invoice value.

The invoice factoring costs depend on numerous factors, including your credit score, the number of years you’ve been in business, and your client’s creditworthiness. Of course, the rate can also depend on how risky your business is. Besides the MatchFactor tool, Nav provides additional services for monitoring your credit score.

If you want to find an account receivable factoring company, Nav’s free service is sufficient. But if you want to improve your credit score, you can subscribe to one of its pricing plans. The most affordable one costs $29.99 per month.

Final Thoughts

If you don’t want to risk having your request for invoice factoring declined, Nav is a safe bet. In addition to factoring financing, Nav offers small business loans, equipment financing, lines of credit, and startup loans.

Reasons to Apply

MatchFactor tools

Credit score monitoring

Various financial products

Secure online service

What You Should Know Before Applying for Invoice Factoring Services

Many B2B companies that sell goods and services rely on invoice factoring to secure capital. Instead of waiting for up to 90 days to get paid by clients, businesses sell their unpaid invoices to a factoring company. In most cases, businesses get between 75-80% of the invoice value. The money is often used for salaries, new investment opportunities, and other expenses.

The factoring company never pays the full invoice amount because there is always a risk that your clients may never settle their debts. The factoring company also charges a fee for its service.

Although the entire process looks simple, there are some things you should know before using invoice factoring for your small business.

Invoice factoring vs. invoice financing: Is there a difference?

When looking for quick access to cash, business owners have two options: invoice factoring or invoice financing.

These services are similar in that you get cash in advance for your unpaid invoices. But there is an important distinction between the two.

Invoice factoring is a financial transaction, while invoice financing is a type of loan. With the former, you sell your invoices, so the factoring company waits for your clients to pay off their debts. With the latter, you use your invoices as collateral. Once your client pays off the debt, you can pay off the loan.

What’s best: non-recourse factoring companies or recourse factoring companies?

Most factoring companies offer one of these two types of services: recourse and non-recourse. The difference between them comes down to who pays the invoice in case your customer doesn’t.

With recourse factoring, you’re responsible if your customer doesn’t pay the debt. This type of factoring is best for businesses that have reliable clients who pay their bills on time. With non-recourse factoring, your factor absorbs the unpaid invoices. This usually means that the factor charges higher fees and takes invoices that might be covered through credit.

FAQ

How much does a factoring company charge?

The best factoring companies for a small business charge fees that range between 1% and 6%. The fee depends on numerous factors, including the time your clients need to pay the invoices and the amount owed.

Is invoice factoring a loan?

No, invoice factoring is not a loan. It’s a financial transaction where you sell your invoices at a discount. The key advantages of this type of transaction is that you get a lump sum of money instantly, and your factor needs to wait for your clients to pay the debt.

What are types of factoring?

According to the best invoice factoring companies reviews, most companies offer recourse factoring. That means you are fully responsible if your clients don’t pay the invoice. With non-recourse factoring, which is rare, the factor absorbs the unpaid invoices.

Is BlueVine legit?

BlueVine is a fully legitimate company. It’s been in business since 2014, during which time it has supported more than 125,000 clients with $6.5 billion. According to numerous online reviews, this is one of the most reputable factoring firms.

Is invoice factoring a good idea?

Generally, if you have reliable clients that pay regularly, invoice factoring is not a problem.

In fact, factoring invoices can be beneficial for your business. Since invoice factoring is not a loan, you are not required to put forward any collateral, and unlike with other financial services, you don’t need to have an excellent credit score. Invoice factoring companies are also ready to give you flexible repayment terms if there isn’t any real risk of your clients not paying.