Non-Recourse Factoring (Factor takes the Credit Risk) vs Prime plus Recourse Factoring
Invoice Factoring Rates & Fees Revealed
Invoice Factoring vs a Ledgered Line of Credit
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.
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 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 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.
We hope this has answered your questions about how invoice factoring fees and charges and the two main different types of invoice factoring-with and without recourse. Alleviate collection, credit, and your small business cash flow problems with No-Credit Risk Factoring from Bankers Factoring where business owners know their true receivable factoring cost.
Understand how factoring works and how it can fund your business.