Invoice Factoring

With invoice factoring, you sell outstanding invoices to a factoring company (the factor) at a discount, often receiving a large portion of the invoice value upfront. The factor collects payment from your customers, then remits the remaining balance minus a fee. Because you are selling an asset rather than borrowing, approval often depends on your customers’ creditworthiness more than your own.

1. Submit an application through ASBCLF with details about your invoices and customers.
2. ASBCLF matches your application with lenders offering invoice factoring.
3. The factor reviews your invoices and the creditworthiness of your customers.
4. If approved, you receive an advance on the invoice value, and the factor collects from your customers.

• Paying suppliers while waiting on B2B receivables
• Meeting payroll during slow collection cycles
• Taking on larger customer orders
• Managing clients with long payment terms
• Smoothing cash flow without new debt

• Business-to-business (B2B) invoices
• Creditworthy customers
• Verifiable, outstanding invoices
• Time in business

Eligibility varies by lender and program. ASBCLF submits your application to its lender network; individual lenders set their own criteria and make their own decisions.

• Invoices to be factored
• Customer account information
• Accounts receivable aging report
• Business financial statements
• Accounts receivable ledger

There is no traditional repayment schedule—the factor collects from your customers. You receive most of the invoice value upfront and the balance, minus the factor’s fee, once the customer pays. Fees are typically a percentage that accrues the longer an invoice remains unpaid.

Invoice factoring converts receivables into cash without borrowing. See how it compares to other short-term financing.