What is Invoice Factoring?
Invoice factoring is a non-loan form of funding called “accounts receivable financing” that enables your business to access working capital in exchange for your unpaid invoices in as little as one business day. Your lender (that’s us) will purchase your business’s outstanding invoices at a discounted price and advance you the net amount in cash, typically between 70-90% of the invoice’s value up to $100,000 per common ownership. We can arrange online invoice factoring in bulk for your entire sales ledger, or for individual or small bundles of invoices.
With online invoice factoring with Venture Plus Partners Capital®, we are responsible for collecting on the invoice. Once your client makes payment, we’ll send you the remainder of the invoice’s value (minus our fee), with terms typically ranging between 30 and 90 days. We know how important your customer relationships are and you can trust us to collect on your invoice professionally.
Invoice Factoring Rates
Online invoice factoring fees are based on the difference between the value of the invoice and our purchase price, your business’s and your client’s financial history and risk assessment, and factors like time to payment. Fees typically fall somewhere between 1-5% of the invoice’s total value for every 30 days the invoice remains unpaid.
Who Should Apply Online for Invoice Factoring?
Invoice factoring is ideal for:
Businesses with long accounts receivable periods
Businesses with large numbers of outstanding invoices
Filling in the gaps between sending invoices and receiving payment
Invoices valued at $15,000+ with extended credit terms, and which are not more than 90 days past due
Businesses seeking fast funding
B2C businesses that need smaller amounts of funding
Invoice factoring can benefit construction companies, pharmacies, law offices, manufacturers, business services, and more. No matter what industry you operate in, our expert Funding Advisors will work closely with you to select the best funding option to help you achieve your business’s goals without sacrificing cash flow.
Businesses with lower credit scores or that do not have collateral, such as real estate and other major assets
How to Get Invoice Factoring
1
Apply
Gather 3 months of bank statements and other records. For faster approval, grant us secure access to your bank account’s transactional data.
2
Choose Funding
A Funding Advisor will reach out to you within 1 hour (during regular business hours) to complete your application & discuss your funding options.
3
Get Funded
Once you and your Funding Advisor determine what funding option works for your business, your funds can be approved and deposited within 24 hours.
4
Repayment
Your funding is repaid when your client pays their invoice. We will tactfully collect payment and send you the remaining amount, minus our fees.
How to Use Invoice Factoring
There are no restrictions on how invoice factoring funding can be used. Funding received from online invoice factoring is typically best used to:
Fill gaps in cash flow without committing to a long term loan.
Cover recurring expenses like payroll, rent, utilities, and more while you wait for
Clients to pay their invoices in full.
Fund growth strategies, new equipment, and other costly purchases that have a strong ROI.
Take advantage of seasonal business opportunities such as purchasing inventory in bulk.
Invoice Factoring Qualification Requirements
Because your invoices essentially act as collateral, online invoice factoring has more flexible qualification requirements than other forms of funding.
Venture Plus Partners Capital focuses on the overall health of your business, not just your credit score, as well as the payment history of your customers. Here are some factors we consider:
Business revenue
Cash flow
Vendor payment history
Years in business
Public records
We do not require first position on invoice factoring and no additional collateral is required.
Invoice Factoring Q&A
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Can I get a merchant cash advance with bad credit?Yes, you may be able to get a merchant cash advance with bad credit if your business has strong cash flow. Alternative lenders like Venture Plus Partners Capital have lower credit score requirements, typically starting around 550. Merchant cash advances, invoice factoring, and other alternative small business funding are ideal options for businesses with low credit scores.
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Can I get a merchant cash advance with no bank statements?Some alternative lenders may approve a merchant cash advance with no bank statements, but you can expect much higher rates. Venture Plus Partners Capital requires three months of bank statements and other financial records. What type of business qualifies for an MCA?
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What type of business qualifies for an MCA?Any business that accepts credit and debit card payments may benefit from a merchant cash advance, regardless of industry. Our team of knowledgeable Funding Advisors will work with you to assess your eligibility.
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How do I qualify for a merchant cash advance?Every business is unique. It’s always best to speak with one of our Funding Advisors to review your circumstances and assess your eligibility. In general, we look for consistent revenue with minimum monthly receipts of $7,500 or more, and 6+ months in business. We know that credit scores don’t tell the whole story, so we also consider the overall growth potential of your business. Are there restrictions for how the funding is used? What is the interest rate on a merchant cash advance?
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Are there restrictions for how the funding is used?We do not restrict how you can use your merchant cash advance funding. We believe small business owners understand best what they need to do to grow their businesses, so while our team may provide some coaching, the final decision is yours. What is the interest rate on a merchant cash advance?
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What is the interest rate on a merchant cash advance?A merchant cash advance does not have an interest rate because it is not technically a loan. An MCA is an advance against future sales. The cost of the advance is called a “factor rate”, and it varies based on each business.