Accounts Receivable Financing Calculator
Learn More About Accounts Receivable Financing
Do you have funds owed to you however you need to wait to receive them? See if you may qualify to get up to 90% of your unpaid invoice, today!
If your business is in a cash crunch due to your clientele paying you after 30 days or more for services or products rendered, there are receivable financing options that can help.
What Is AR Financing?
A/R financing (Factoring) is the selling of open and completed invoices for cash now. This kind of financing allows you to get paid now instead of waiting more than 30 days to be paid by your client, it can help cover costs of labor and material. Factoring typically focuses on the creditworthiness of your clientele that owes you the unpaid invoices versus your personal credit. Traditionally invoices are collected by the Factor directly from the client, in some cases you may be able to handle the payments of invoices directly.
Typically rates average anywhere between 1-4% per month of the invoice amount contingent upon the creditworthiness of client. Costs are estimated to be around .01% to .0133% per day every calendar month the factored invoice is outstanding. Traditionally costs are significantly less than alternative products or unsecured debt instruments. Depending on the factoring agreement there may be additional one time service fees or account setup fees and rates are contingent upon Non-Recourse or Recourse Factoring Agreements.
Business credit score of the orderer (client) is key in figuring out eligibility for this product. It is imperative the clientele you wish to factor are US based and creditworthy. Other factors include, industry type, your business public records and age of the invoices to be paid.