With invoice factoring, a business can convert unpaid invoices into immediate cash through an advance of 80% to 90% of the total amount owed. We reviewed more than 25 invoice factoring companies based on 18 factors to select the six best invoice factoring providers. Each company selected earns stellar reviews from small business owners.
Best Factoring Companies
Invoice Factoring Companies | Best for |
|---|---|
Quick invoice factoring up to $5 million | |
Nonrecourse factoring up to $10 million | |
Monthly contract factoring up to $20 million | |
Short-term invoice factoring up to $5 million | |
Freight factoring up to $20 million |
*Last Updated: February 2020
How We Evaluated Invoice Factoring Companies
After considering some of the newest players in the invoice factoring space and the most popular invoice factoring companies, we chose the six best factoring companies. In establishing our review criteria, we considered the pain points we’ve heard small business owners express, such as how much they can receive and how quickly they can access funding based on assets.
Overview of the Best Invoice Factoring Companies
Learn More | Max Funding Amount | Expected APR | Min. Annual Revenue | Speed |
|---|---|---|---|---|
$5 million | 13% to 70% | $100,000 | 1 day | |
$10 million | 16% to 55% | $360,000 | 3 days | |
$20 million | 12% to 55% | $600,000 | 3 days | |
$5 million | 9% to 55% | $360,000 | 2 days | |
$20 million | 13% to 55% | $100,000 | 5 days |
BlueVine: Best Overall Invoice Factoring Company
Small businesses needing to factor invoices from $5,000 to $5 million per month at starting 0.25% weekly discount rates will benefit from BlueVine. BlueVine doesn’t directly interact with customers and does not collect invoices on behalf of the business. However, unlike an invoice financing provider, BlueVine still requires the assignment of invoices.
BlueVine Invoice Factoring Rates & Fees
- Discount rate: 0.25% to 1.35% per week
- Expected APR: 13% to 70%
- Origination or maintenance fees: None
- Prepayment penalties or termination fees: None
- Additional fees: $15 wire fee; automated clearing house (ACH) is free
BlueVine’s weekly discount rate begins at 0.25% of the factored invoice value, which is the amount the company charges as its fee. A 0.25% discount rate on $10,000 of invoices equals $25. This equates to discount rates starting at 1% per month, which compares favorably to Paragon Financial Group’s 1.25% starting rate.
BlueVine Invoice Factoring Terms
- Funding amount: $5,000 to $5 million per month
- Advance rate: 85% to 90% on invoices with face values of $500 or more to business-to-business (B2B) customers
- Repayment term & schedule: Advances are repaid as customers pay their invoices
- Personal guarantee: Required
- Speed to funding: 10 minutes to apply with a decision and funding as soon as the next day; ongoing funding the next day is free via an ACH; same day is $15 via a wire
BlueVine offers an advance rate of 85% to 90%, which is set based on its evaluation of the company and customers. Applicants can receive advances on $5,000 to $5 million in invoices monthly. BlueVine’s minimum factoring amount is lower than most invoice financing companies making it a great option for business owners wanting a lower-cost alternative.
BlueVine Factoring Minimum Qualifications
- Personal credit score: At least 530
- Time in business: At least three months
- Annual revenue: At least $100,000
While the other providers on our list of the best invoice factoring companies are relying on the creditworthiness of an applicant’s customer, BlueVine is looking for its borrowers to meet minimum credit qualifications. In addition, it wants customers to be creditworthy. Unlike most of the other invoice factoring companies on this list, it doesn’t have any specific industry specializations.
BlueVine Invoice Factoring Additional Features
- Customer interaction: None
- Type of invoice financing agreement: Recourse
BlueVine offers invoice factoring on a recourse basis. While it still requires a business’s customers to pay invoices directly to a bank account it establishes, BlueVine will not communicate with customers directly. This differs from most of the other invoice factoring companies we reviewed.
What BlueVine Is Missing
One drawback to BlueVine is that to qualify, business owners need a personal credit score of at least 530. This is not a requirement for most of the other best invoice factoring companies. However, BlueVine offers funding amounts as low as $5,000. This limit is lower than most of the best invoice factoring companies.
BlueVine Reviews
We compiled BlueVine reviews from around the web and determined it has mostly positive ratings. Positive BlueVine reviews focused on BlueVine’s responsive customer support team and transparent pricing. Critical BlueVine reviews were from users unhappy at being denied funding or about BlueVine’s fees.
How to Apply With BlueVine
The BlueVine application process is simple and entirely online. Business owners can connect BlueVine to invoicing or accounting software and select the invoices that are a priority to finance.
Paragon Financial Group: Best for Nonrecourse Factoring
Paragon Financial Group is great for small businesses as it can help in most situations, including payroll or legal troubles. It offers factoring limits, from $30,000 to $10 million monthly and rates of 1.25% to 2.5% per 30 days. Only TCI Business Capital and Triumph Business Capital offer higher limits of $20 million.
Paragon Financial Group Invoice Factoring Rates & Fees
- Discount rate: 1.25% to 2.5% per 30 days
- Expected APR: 16% to 55% or more depending on individual fees
- Origination fee: Small, one-time fee
- Additional fees: None
Paragon declined to provide an APR range. However, we estimated its APR to be between 16% and 55%. Paragon Financial Group’s discount rate includes credit protection and accounts receivable management. This service isn’t provided by some factoring companies like BlueVine. So, while business owners pay a little more—starting rates of 1.25% at Paragon compared to 1% with BlueVine—some businesses might find this value-added service beneficial.
Paragon Financial Group Invoice Factoring Terms
- Funding amount: $30,000 to $10 million per month
- Advance rate: 80% to 90%
- Repayment term & schedule: Repaid as invoices are paid
- Personal guarantee: Most likely required
- Speed to funding: Three to 10 business days
The minimum monthly factoring limit with Paragon Financial Group is $30,000. Paragon Financial Group has reciprocal relationships with other invoice funding companies, and so it will help applicants find a relationship with another provider if the amount factored changes.
Paragon Financial Group Factoring Minimum Qualifications
- Credit score: Not a factor; credit problems OK, such as slow-paying customers, IRS issues, payroll problems, and legal troubles
- Time in business: Not a factor
- Annual revenue: At least $30,000 in invoices per month
When qualifying a business for invoice factoring, Paragon Financial Group relies more on the creditworthiness of debtors than the business. It’s OK if applicants have serious credit problems, such as issues with the IRS and payroll troubles. Each customer must be individually approved by Paragon, which will run a Dun & Bradstreet credit check on them.
Paragon Financial Group Invoice Factoring Additional Features
- Customer interaction: Required
- Assignment of invoices: Required
- Type of invoice financing agreement: Recourse and nonrecourse available
Paragon Financial Group offers contract and spot factoring on a nonrecourse basis. With spot factoring, business owners can pick the invoices to factor. The spot factoring option is an advantage because business owners have the flexibility to choose which invoices to factor, so long as they meet the $30,000 monthly minimum. Since the company is purchasing the invoices, it will interact directly with customers.
What Paragon Financial Group Is Missing
Paragon Financial Group only offers nonrecourse factoring. While nonrecourse invoice factoring companies are known for being more expensive, Paragon Financial Group’s pricing remains competitive. If an invoice was outstanding for 30 days with BlueVine, the rate would start at 1% compared to a starting rate of 1.25% with Paragon.
Paragon Financial Group Reviews
We compiled user reviews from around the web and determined that Paragon Financial Group reviews are positive. Customers who recommend Paragon Financial Group were impressed with the responsive customer support team. There were no negative reviews found at the time this article was written.
How to Apply With Paragon Financial Group
Applications for factoring are submitted to Paragon Financial Group electronically. Business owners must provide the most recent accounts receivable (A/R) aging report, accounts payable (A/P) aging report, a customer list, and a sample invoice. A representative from Paragon will then contact approved applicants to develop a custom factoring solution. The entire process typically takes three to 10 business days.
TCI Business Capital: Best for Monthly Contracts
TCI Business Capital is among the best invoice factoring companies because it offers a month-to-month contract and re-evaluates the discount rate every month to see if it can be reduced. If factoring volume increases or customers pay their invoices quicker, the rate of 1% to 4% could decrease. This is great compared to altLINE, which locks in a yearly rate.
TCI Business Capital Invoice Factoring Rates & Fees
- Discount rate: 1% to 4% per invoice monthly
- Expected APR: 12% to 55% or more depending on individual fees
- Origination fee: None
- Additional fees: $12.95 ACH fee; $19.99 wire fee
TCI charges an additional fee when businesses receive payments and advances via ACH or bank wires. It should specify these fees in the factoring agreement. It’s also possible that TCI may charge customers that don’t meet its $50,000 factoring minimum additional fees. We always recommend studying the factoring agreement to make sure all the charges are clear and easy to understand.
TCI Business Capital Invoice Factoring Terms
- Funding amount: $50,000 to $20 million per month
- Advance rate: About 90% on B2B or business-to-government (B2G) customers due in 30 to 90 days
- Repayment term & schedule: Paid automatically as customers pay their invoices
- Personal guarantee: Possible, depending on the strength and age of the business
- Speed to funding: Three to four days
The minimum monthly factoring limit with TCI Business Capital is $50,000. Businesses that can’t meet this monthly minimum should consider invoice factoring companies with no minimums.
TCI Business Capital Factoring Minimum Qualifications
- Credit score: Not a factor
- Time in business: Not a factor
- Annual revenue: At least $50,000 in invoices per month
As with several of the other providers on our best invoice factoring companies list, TCI Business Capital will consider the industry when evaluating an application. While TCI works with some different industries, several of its top industries include trucking and freight, oil and gas, and telecommunications.
TCI Business Capital Invoice Factoring Additional Features
- Customer interaction: Required
- Assignment of invoices: Required
- Type of invoice financing agreement: Recourse
TCI Business Capital offers recourse factoring. TCI also lets business owners pick which customer invoices to factor every month, with a mix of spot and contract factoring. For those invoices, TCI Business Capital requires an assignment of invoices.
What TCI Business Capital Is Missing
The main downside we found with TCI Business Capital is that it has a higher minimum monthly factor amount that businesses must hit than the other invoice factoring companies we reviewed. This puts TCI out of reach for those with less than $50,000 per month in invoices. A month-to-month contract can also be bad for some customers, particularly those needing the security of a long-term contract.
TCI Business Capital Reviews
We compiled user reviews from our website and around the web and determined that TCI Business Capital reviews are positive. Customers who gave TCI Business Capital positive feedback said that the company’s customer service team is professional and reliable. Customers who gave TCI Business Capital critical feedback said that trying to adjust the original terms can be difficult.
How to Apply With TCI Business Capital
To apply with TCI Business Capital, business owners fill out an application online or by phone. Applicants will most likely need to provide tax returns, an A/R aging report, and an A/P aging report. The approval process takes three to four days before initial funding.
altLINE: Best Invoice Factoring Company for Net Terms Under 30 Days
altLINE is good for businesses with net terms less than 30 days needing up to $5 million as it offers lower rates for shorter terms. If invoices are paid in less than 30 days—usually 15—business owners may receive a discount rate as low as 0.75%. Other than BlueVine, that is the lowest discount rate offered by the factoring companies we reviewed.
altLINE Invoice Factoring Rates
- Discount rate: 0.75% to 3.0% per invoice for up to 30 days, with discount rate increases every 15 days after that
- Expected APR: 9% to 55% or more depending on individual fees
- Origination fee: $350 one-time fee
- Additional fees: $30 wire fee; no monthly minimum fees
altLINE uses a tiered discount rate system. The quicker the invoices are paid, combined with the larger the amount factored on a monthly basis, the lower the fee is. The best rates are reserved for those factoring $300,000 or more per month, with clients paying in 15 to 30 days or less.
altLINE Invoice Factoring Terms
- Funding amount: $30,000 to $5 million per month
- Advance rate: About 90%
- Repayment term & schedule: Paid automatically as customers pay their invoices
- Personal guarantee: Required
- Speed to funding: Two to seven days for initial approval
Businesses that don’t meet altLINE’s $30,000 factoring minimum can still apply. Unlike other providers we reviewed, business owners can qualify for altLINE invoice factoring as a startup and with low revenue. This is because altLINE also evaluates the company’s potential for growth. If a company is growing quickly and needs invoice factoring, altLINE is a great solution.
altLINE Factoring Minimum Qualifications
- Credit score: Not a factor
- Time in business: Not a factor
- Annual revenue: At least $30,000 in invoices per month
As with many other factoring companies, altLINE will consider the industry applicants are in. While altLINE works with some different industries, several of its top industries include staffing and payroll companies, manufacturing and wholesaling, and distribution.
altLINE Invoice Factoring Additional Features
- Customer interaction: Required
- Assignment of invoices: Required
- Type of invoice financing agreement: Recourse
While altLINE requires an assignment of all invoices, its flexibility in communicating with customers is one of its bright spots. Business owners can communicate with customers and let them know where to send their future payments. It won’t contact customers at all unless they are past due, and business owners will be kept in the loop on all customer communications.
What altLINE Is Missing
altLINE requires its clients to factor at least $30,000 per month or be growing quickly toward this minimum.
How to Apply With altLINE
To get approved for invoice factoring with altLINE applicants begin by speaking with a representative of the company about their needs. Business owners can get the process started by submitting a request for a free quote on altLINE’s website. Business owners most likely need to provide tax returns and A/R and A/P aging reports. The entire application and approval process typically takes two to seven days.
Triumph Business Capital: Good Invoice Factoring Option for Freight Factoring
Triumph Business Capital offers recourse or nonrecourse factoring with 77% of its business coming from freight factoring. Triumph Business Capital requires at least a 500 personal credit score. Triumph Business Capital offers advance rates up to 90%, no minimum limits up to $20 million, and monthly discount rates as low as 1% to 4%.
Triumph Business Capital Invoice Factoring Rates
- Discount rate: 1% to 4% per month
- Expected APR: 13% to 55% or more depending on individual fees
- Origination fee: A small one-time fee is possible
- Additional fees: None
All fees are specified in the factoring agreement, and Triumph Business Capital declined to provide specific fees and APR ranges. Business owners may be charged fees specific to their agreement. However, fees and rates are determined on a case-by-case basis. This is similar to most other providers and why we always recommend studying the factoring agreement.
Triumph Business Capital Invoice Factoring Terms
- Funding amount: Up to $20 million, with no stated minimum
- Advance rate: About 90%
- Repayment term & schedule: Repaid as invoices are paid
- Personal guarantee: Possible
- Speed to funding: Five to seven business days
There is no stated minimum monthly factoring with Triumph Business Capital. This is especially valuable for smaller trucking companies that have one to five trucks and only $10,000 in monthly invoices to factor. Although this is the only provider that offers no minimums, business owners will typically still need to have at least $10,000 in invoices to factor for Triumph Business Capital to justify the cost.
Triumph Business Capital Factoring Minimum Qualifications
- Personal credit score: Typically at least 500, with some exceptions
- Time in business: One year or more
- Annual revenue: At least $100,000
To qualify, business owners must work with B2B or B2G customers. Additionally, invoices must be due and payable within 90 days and not pledged to another lender. Unlike most of the best factoring companies, Triumph Business Capital requires a minimum credit score. However, exceptions are made for businesses with well-qualified debtors. Typically, if Triumph Business Capital works with them already and has experience of on-time collections.
Triumph Business Capital Invoice Factoring Additional Features
- Customer interaction: Required
- Assignment of invoices: Required
- Type of invoice financing agreement: Recourse is standard; nonrecourse possible with a higher discount rate and lower advance rate
The standard invoice financing product offered by Triumph Business Capital is recourse. This means borrowers are responsible if customers don’t pay. The length of time Triumph Business Capital will hold an unpaid invoice before requiring a business to pay will be established in the factoring agreement.
What Triumph Business Capital Is Missing
Although Triumph Business Capital offers factoring solutions to many industries, it may not have the same experience as other lenders outside of freight factoring. Although this typically isn’t an issue, working with a factoring company that has experience in the industry can mean a faster approval time.
Triumph Business Capital Reviews
We compiled user reviews from around the web and determined that user reviews of Triumph Business Capital are generally positive. Positive Triumph Business Capital reviews noted its level of service, quick funding, and professionalism. Some users left negative reviews of Triumph Business Capital because they could not get approved for funding. To read more reviews like these, visit our Triumph Business Capital reviews page.
How to Apply With Triumph Business Capital
Business owners can apply for Triumph Business Capital invoice factoring online. It takes five to seven days to get approval and funding. After Triumph Business Capital approves the application, all future invoices will take 24 hours.
Visit Triumph Business Capital
Bottom Line
Invoice factoring is a good tool for businesses needing to cover cash flow gaps while waiting for customer payments. Even businesses with credit problems can qualify. Many invoice factoring companies provide valuable services such as accounts receivable management and collections at no additional cost. The best factoring companies we reviewed are good options for small businesses.
Jimmy Peebles
Looking for 2% first 30 days and 1% on each 30 afterwards up to 90 days based on 80% with 20% at end of factoring.
Amanda Norman
Hi Jimmy,
Thanks for visiting the site! You’ll need to contact one of the invoice factoring companies directly to discuss the invoice factoring rates, costs, and fees that you’re interested in.
Best wishes.
Mandy, Moderator
Charles Sheppard
Great article! Very thorough.
We actually wrote a similar article with particular advice for those in the trucking industry on how to choose the best factoring company (accutraccapital.com/resources/blog/how-to-choose-the-best-factoring-company-for-trucking). With so many companies out there it can be difficult to know what criteria to apply when selecting the right company to factor with. We too are a factoring company (Accutrac Capital Solutions Inc) exclusively servicing the trucking industry. Would love if you considered us the next time you write on this category. Thanks.
Amanda Norman
Hi Charles,
Glad you liked the article. We typically review and update our buyer’s guides once per year and can take a look at your service then!
Thanks for stopping by and sharing!
Mandy, Moderator
Scott Lanaway
Hi there. Great post! We work with Liquid Capital, would love to see them on your list. Check out their ‘Invoice Factoring Guidebook’. It gets in to the ins and outs of different Factoring providers, terms, options etc. They also offer ABL etc. They can work with smaller fundings all the way up to $10 million.
Crystalynn Shelton
Hi Scott, glad you enjoyed our article on the 6 Best Invoice Factoring Companies. We will definitely check out Liquid Capital when we update this article later in the year.
Best-
Crystalynn Shelton, CPA
Troy Cartmill
An amazing factoring company thats not on this list is Crown Financial . It’s a smaller company so customer service is amazing. They can fund up to 25 Million, offer low rates and can give funding in 24 hours.
Laura Handrick
Troy, Thanks for sharing your experience with Crown. We’ll check it out when we next update this article.
Best!
Laura, Staff Writer
Jason Krasick
We’re in the wholesale and distribution business and sometimes face cash flow issues with larger orders. Which company is the better choice for us?