How Much do Factoring Companies Charge?
Non-Recourse Factoring (Factor takes the Credit Risk) vs Prime plus Recourse Factoring
Invoice Factoring Rates & Fees Revealed
Invoice Factoring Rates Explained vs a Ledgered Line of Credit’s Cost

What is the True Cost of Factoring Receivables?
Table of contents
- How Much do Factoring Companies Charge?
- Non-Recourse Factoring (Factor takes the Credit Risk) vs Prime plus Recourse Factoring
- Invoice Factoring Rates & Fees Revealed
- What is Invoice Factoring’s Cost to You?
- What is Your Factor Cost?
- A Chart of Factoring Charges
- Invoice Factoring Rates Explained with an Example
- Ready for the owner-employees of Bankers Factoring to fund your entrepreneurial dreams with easy-to-understand factoring fees? Call 866-598-4295 or go to Bankers-Factoring-Application.
What is Invoice Factoring’s Cost to You?
Many Factoring companies make it difficult to calculate your true cost of invoice factoring. At Bankers Factoring, our goal is that you can calculate your A/R factoring rates and fees, including credit protection, in your head. Here are non-recourse factoring rates and fees explained.
Business Accounts Receivable Factoring is not algebra and, at its most complex, requires a small bit of multiplication. We want you and your CPA to understand the accounting math behind your cost of factoring receivables at Bankers Factoring and what non-recourse factoring means for the success of your business.
What is Your Factor Cost?
Your total cost to factor your invoices is your factor rate times the invoice amount. The higher the factor advance rate, the lower your overall cost. Also, an implied cost is how long the factoring company holds your reserve.
The following example of non-recourse accounts receivable financing includes the discount fee and the entire fee structure. The length of time the customer takes to pay is 45 days until the invoice is paid. Working capital is moved forward by 30 to 90 days to get you through any short-term cash crunch via our factoring services. Other factoring companies may have additional A/R factoring rates and factoring charges.
Also, read our article on how much d factoring companies charge.
A Chart of Factoring Charges
Here is a chart comparing the Prime Plus Factoring with Recourse (or ledgered line of credit) method found on a popular Google Search for factoring rates versus Bankers’ No-Nonsense, No Credit Risk Factoring. We want you to clearly understand what factoring companies charge you and your total invoice factoring cost. Why wait 30 or 60 days for your customers to pay?
Invoice Factoring Rates Explained with an Example
$100,000 Invoice 45-Day Terms
And the above full disclosure rates include bad debt credit protection. Bankers Factoring takes the credit risk against your customers filing bankruptcy or going insolvent. In addition, your factoring rate structure could go down as you do more volume.
Depending on your industry and company’s sales per month, your advance rate would be 80-93% with a factoring rate of .9-1.6% per month with a daily rate after the first 30 days. You will also see flat fee rates but these tend to be at a slightly higher cost to you than a daily rate.
Pay special attention to the factoring advance rate or the percentage of the invoice you receive upfront. The advance rate changes your true cost to factor dramatically.
We hope this has answered your questions about invoice factoring fees and charges and the two main types of invoice factoring- with and without recourse. Alleviate collection, credit, and small business cash flow problems with No-Credit Risk Factoring from Bankers Factoring, where business owners know their true accounts receivable factoring cost.
We want you to understand how factoring works, how invoice factoring rates are computed, and how it can fund your business.