How to Pick the Best from All the Invoice Factoring Companies
What is Best? Recourse or Non-Recourse Factoring?
Table of contents
- How to Pick the Best from All the Invoice Factoring Companies
- What is Best? Recourse or Non-Recourse Factoring?
- Is there a difference between non-recourse factoring companies?
- Working Capital Plus Credit Protection
- The best factoring companies offer:
- What is non-recourse factoring?
- How much does non-recourse factoring cost?
- The amount you pay to factor depends on several factors, including:
- Factoring Fees from other Invoice Factoring Companies can include:
- Are factoring fees tax deductible?
- What is the difference between recourse and non-recourse factoring as factoring options?
- Do you need good credit for factoring?
- What are the risks of non-recourse factoring?
- How are you approved for factoring?
- Why Bankers Factoring is the best non-recourse factoring company.
- Why Choose Bankers Factoring
- Ready for the owner-employees of Bankers Factoring to help you grow your company with our award-winning non-recourse invoice funding services, including bad debt protection? Use our fast online factoring application or call the toll-free number 866-598-4295.
Is there a difference between non-recourse factoring companies?
Factoring is the best way to maintain business cash flow, especially if you have a business that has problem with bank loan approval. Factoring companies can give your business money upfront by buying your accounts receivable (A/R) at a discount. A/R factoring allows you to avoid late payments and get paid faster. It also gives you access to the same business day working capital to take care of payroll or other expenses that require payment in advance, even with your large customers paying in 90 days.
Invoice factoring companies provide businesses with vast working capital based on their unpaid invoices. Bankers Factoring strictly offers non recourse factoring company services throughout the United States with great customer service, and same day increased cash flows. From New York to North Carolina, from Alaska to Hawaii, we believe we are the best non-recourse factoring company choice for your growing business.
Receive a fast factoring credit line from us against your unpaid invoices. Trucking and freight companies critically need non-recourse invoice factoring. We also fund in more sectors then other factoring companies offer with our award-winning factoring company service.
Working Capital Plus Credit Protection
Non-recourse factoring is the elite financing solution for businesses that need credit protection. Non-recourse agreements protect your business from unpaid receivables – we take on the credit risk. The only way to protect your cash flow is by Selling Your Invoices to The Best Factoring Company. Let Bankers Factoring (Bankers) be both your fact checker and vast working capital source.
Whatever the reason, if your business cannot get enough money fast enough, then eventually, it will go under. We help companies keep their doors open, pay employees on time, take the credit risk, and manage their accounts receivable (A/R) process. Bankers is not driven by your financial statements or personal credit, funding is based on good invoices and your good, paying customers (the account debtors).
With the help of an award winning, non-recourse factoring company like Bankers Factoring, keeping your company healthy and cash flow flowing will be as easy with the best factoring services line of credit. Get started with our online application, fast factoring proposal, and your own online account.
The best factoring companies offer:
- Up to 93% cash advances on your invoices.
- Easy application process with 24 hours to funding after set-up.
- Same-day factor funding services after setup with low factoring discount rates.
- Bad debt protection or non-recourse A/R factoring.
- Access up to $4,000,000 in monthly funding with zero revenue requirement.
- Invoice factoring is cheaper than business credit cards to fund your business.
- Small businesses turned down by local community bank business loan.
- Special construction companies staffing payroll fund programs.
- Receive your cash advance with maximum funding amounts in less than 48 hours.
- Named one of the best factoring companies in 2022 and 2023.
- We are not fico score or credit score driven.
- One of the leading trucking factoring companies.
- An unlimited business line of credit based on your A/R.
- 24/7 online reporting mobile app with a dedicated account executive and back office.
- Free credit checks of your customers with great funding options.
- Special programs for owner-operators, freight brokers, and trucking companies with transportation factoring and freight factoring.
- Small business loan turndown specialists invoice factoring programs.
- Invoice factoring agreements that are easy to understand.
- Outsourced support for A/R account management and free credit check/credit departments.
- More time and money to grow your business with a high advance rate and a low factoring fee.
You can also read how much do factoring companies charge.
What is non-recourse factoring?
Non-recourse factoring is a form of financing that allows you to receive payment immediately for your receivable invoices. Also called invoice factoring and accounts receivable financing. Non-recourse or without recourse factoring is when the factoring company takes on credit risk for uncollected A/R. Full recourse factoring is where the factoring client, not the factor, carries all the risk of non-payment.
Factoring companies buys your invoices at a slight discount and advance 80 to 93% of your invoice value. Invoice funding can be highly beneficial if you wait for customers to pay their bills. Slow-paying customers can have longer credit terms causing another delays. By selling these invoices at a slight discount, you receive cash immediately instead of waiting for payment from your customers or even having them default (bankruptcy).
You can also read which is better, recourse or non-recourse factoring.
If you are in the trucking business, the right trucking and freight factoring companies can make a huge difference to your bottom line and even your survival. Non-recourse should be mandatory since the trucking industry and logistics can be such volatile industries. You need a factoring company to assume the credit risk on your customer invoices with no hidden fees for trucking companies.
Related article: Understanding Non-Recourse Invoice Factoring
How much does non-recourse factoring cost?
Now that you know what non-recourse factoring is and how it can help your business let us talk about the cost for same day funding.
The amount you pay to factor depends on several factors, including:
- The size of your business
- The credit of your customers (account debtors)
- How quickly do your customers pay
- The amount of risk involved with your industry
- The amount of factoring you require each month
The fees can range anywhere from 1% – 3% per invoice processed, based on the size of your business. The larger your monthly A/R, the lower your factoring rates. In addition, the factoring rate or costs, there may be other fees or expenses incurred, including:
Factoring Fees from other Invoice Factoring Companies can include:
- Processing fees
- Wire transfers fees
- Administration fees
- Invoice uploading fees
- Payments process fees
- Make sure each factor includes their fee schedule in their agreement
Also, make sure the factor you are talking to isn’t too small and has enough factoring capacity for your growing business. Their revenue requirements and your sales and terms must be a match.
Related article: Factoring Rates and Fees Explained
Are factoring fees tax deductible?
The answer is yes, but it depends on four primary considerations.
- Your business location
- The type of factoring agreement
- The business relationship with the factor
- Factoring cost are deductible if you sell, not finance your receivables.
Factoring fees are deductible as a business expense when you sell invoices – you can take the tax deductions.
What is the difference between recourse and non-recourse factoring as factoring options?
When talking to prospective factoring companies, know the difference is that recourse factoring is when a seller must pay back any debt the buyer does not pay for. On the other hand, with non-recourse factoring, once you sell your receivables, you are no longer responsible for collection.
To see all the frequently asked questions about factoring, please visit our invoice factoring FAQ.
Bad debt protection through non-recourse factoring at Bankers protects your business from customers who:
- Bankruptcy: your customer has run out of funding and has filed with the courts to seek relief
- Insolvency: your customer does not have the financial means to fulfill their obligations or debts
- Protracted slow pay: even outside of the extended payment terms, some customers short-pay or pay slower than their terms because of financial troubles.
You can also read our article on how to sell your invoices to the best factoring company.
Do you need good credit for factoring?
If you have bad credit, it is not the end of the world. No matter your financial situation, there are options to help you escape a bad situation and start fresh with a clean slate. Factoring companies do not require perfect credit scores to approve applications for factoring. Still, they do conduct thorough background checks that include an examination of your current credit profile. Qualifying for factoring is much easier than traditional lending through banks and lenders.
Because of repayment risk, lenders want to avoid doing business with individuals with less-than-stellar credit scores. Nevertheless, factoring companies do not operate under those same rules. At Bankers Factoring, we know that many businesses need working capital right now – regardless of their prior financial situation. We work hard to ensure that commercial funding is accessible through non-recourse factoring programs.
Related article: The Due Diligence Process in Invoice Factoring
What are the risks of non-recourse factoring?
The main risk of non-recourse factoring is customer default for quality or performance issues, which the factoring company should provide bad debt protection. From a client finance perspective, they risk misuse or allocating factoring funds and not paying bills on time. Business owners need to use their funds strategically to succeed.
Make sure there is enough cash flow each month, and you will be able to pay bills in a timely manner with our funding solutions.
Related article: The Pros and Cons of Invoice Factoring
How are you approved for factoring?
For factoring approval, you must have customers with a good credit rating and an operational business. The approval process for factoring takes 3 to 5 days compared to traditional lending, which takes months. Aside from solid customer credit ratings, there are some main criteria:
- Client’s A/R aging summary and bank statements.
- Copy of your clients’ invoices you want to factor from your operation.
- Personal and business identification like email address and website.
- Businesses turned down for bank business loans are our specialty.
- List of any MCA or ordinary loans.
Related article: 8 Requirements to Qualify for Invoice Factoring Services
Why Bankers Factoring is the best non-recourse factoring company.
With the help of the best non-recourse factoring company, you can keep your business healthy and cash flowing. If you are struggling to stay afloat, factoring can help. There are many reasons why your business might be having trouble creating cash flow. Pick a factoring company that assumes the credit risk for remaining invoices and same day wires (versus slow ach payments) the money right to your business bank account.
The economy may be down, and people are not spending as much on what you sell. Alternatively, the competition has gotten more robust, and your costs have gone up, making it harder for you to make enough profit to cover those extra costs.
You can also read how to pick the best factoring company for your specific needs and receive the maximum invoice amount upfront.
Why Choose Bankers Factoring
The decision to use Bankers Factoring non-recourse factoring can be life-changing for your business. With the right factoring company on your side, the funding process is easy and safe for your small business. We hope you choose Bankers for non-recourse help with your unpaid invoices via invoice financing. We want to be your provider of invoice factoring services. Don’t wait 30 days for payment ever again. Receive maximum funding with high advance rates and a low discount rate from the best invoice factoring company for small business owners- with the best invoice factoring service and zero revenue starting point and great online reviews.
And remember, Bankers Factoring company assumes the credit risk for small B2B businesses without a credit department – many factoring companies don’t. Great customer support. Online account access. As a business owner, you can make money with our money. We want to be your non-recourse only invoice factoring company turning outstanding invoices into same day maximum funding working capital.
Bankers,as the best factoring company collects payment in a friendly and unobtrusive manner as part of the factoring process so you can pay your financial obligations like payroll and rent.
With simple fees, high advances rates, and our easy-to-understand non-recourse factoring agreements, you will enjoy working with the professional services of the owner-employees of Bankers Factoring versus other factoring companies. This is why we were awarded for 2022 and 2023 as one of the best invoice factoring companies for entrepreneur clients.