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Best Invoice Factoring Companies to Consider in 2023

Unpaid invoices tie up your cash flow and can restrict your business’ growth. You can also spend time and money trying to collect those invoices. Invoice factoring gives you immediate access to some of that money, so you can keep your business operating.

Best Invoice Factoring Companies
Paige Cerulli
Written by:Paige Cerulli
Business Content Writer

Reviewed by: Sarah Brooks, Personal Finance Writer and Editor

Fact Checked by: Thomas Brock, Financial Analyst and Accountant


Many or all of the products featured here are from our partners who compensate us. This may affect which companies we write about and where the company appears on a page. However, any analyses, or reviews expressed in this article are those of the author’s alone, and have not been approved or endorsed by any partner.

Businesses need continuous income to operate and grow, but unpaid invoices can create significant cash flow problems and restrict your business. When you work with an invoice factoring company, that company will do the hard work of getting those invoices paid.

The company will also offer you an advance on those balances, so you don’t have to wait to get paid. And compared to a small business loan, invoice factoring is typically easier to qualify for. Our team of financial experts reviewed and ranked the top invoice factoring companies to help you get funded.

Top Picks for Best Invoice Factoring Companies

Top Picks for Best Invoice Factoring Companies

It’s important to choose an invoice factoring company that’s right for your business. As you explore your options, you’ll need to consider multiple elements of each company and decide if it meets your business funding needs.

In this review, we highlight the terms, rates and fees of each company and explain what makes them a good option. We also share potential downsides of each lender, and provide a rating methodology you can use to select the best option for your needs.


Best Invoice Factoring Companies for 2023 - Full Overview

If you’re thinking about invoice factoring for your business, you’ll want to consider these top invoice factoring companies.

Best Overall
Lendzi logo

Lendzi - Best for Multiple Lending Options

Min. Annual Revenue
Min. Time in Business
6 months
Min. Credit Score
At least 500
Key Features
  • Competitive starting rates on most products
  • No minimum credit requirement
  • See your options without hurting your credit
  • Flexible terms
  • Excellent customer reviews on independent review sites
Pros & Cons
  • Comparison shop multiple lending options
  • Competitive rates and fees
  • Funding in as little as 24 hours
  • Minimal paperwork required
  • No collateral required
  • Rates and fees may be higher than with traditional loans
  • If invoice goes unpaid, you may owe for that amount

Lendzi is both a direct lender and a partner with more than 75 other lenders, allowing you to comparison shop for the best invoice factoring option. If you need cash now and have outstanding invoices, Lendzi may be able to help get you the funds you need with some of the lowest fees and rates available.


Main Features

To apply for invoice factoring through Lendzi, simply fill out their online application. This will not impact your credit score and no documentation is required at this step. From there, a representative will reach out to discuss your options. Expect to submit some paperwork, such as copies of all unpaid invoices, contact information for each invoice, profit and loss statements from your business, and bank statements. If approved, funds can be in your account in as little as 24 hours.

Lendzi is a reputable company with more than 2,000 5-star reviews since its inception just a few years ago. They work with business owners with poor credit and with those who have been denied elsewhere. If you need a loan or invoice factoring, Lendzi may be your best option for getting the funds you need to continue to run your business.

Credibly - Best for Poor Credit Scores

Min. Annual Revenue
Min. Time in Business
6 months
Min. Credit Score
Key Features
  • Simple application process
  • As soon as same day funding
  • Open to high-risk industries
Pros & Cons
  • Approval based on more than just credit
  • Advances up to $400,000
  • Easy application: Takes 10 minutes
  • Approval in one day
  • Funding 48 hours from approval
  • Factoring fees can be high
  • Multi-step application process

Credibly’s invoice factoring allows business owners to get capital for their invoice balances in just 48 hours. Business owners can get pre-qualified for up to $400,000, and they look at more than just your credit score. Credibly evaluates your business’ overall health, making this lender a good choice for businesses who have lackluster credit ratings.


Main Features


Credibly has a multi-step application process. You’ll start by submitting some basic business information, which Credibly reviews in as little as one day. When evaluating your business for invoice factoring, Credibly weighs factors like the number of invoices you have, your industry, and more. If you’re approved for invoice factoring, you can receive the full advance in your account that same day. Invoice factoring fees range from 0.5% to 4.0%, and Credibly is upfront with any fees that you might face.

Credibly doesn’t base invoice factoring approvals only on credit scores, and instead takes a holistic approach to evaluating your business. The ability to receive funding the same day that you’re approved is an advantage for business owners who need money quickly.

Fundera - Best for Exploring Multiple Options

Min. Monthly Revenue
No minimum requirement
Min. Time in Business
No minimum requirement
Min. Credit Score
Key Features
  • Connections to multiple lenders
  • Competitive rates
  • Soft credit check
Pros & Cons
  • Compare multiple quotes
  • Easy online application
  • Funding Advisor to answer your questions
  • Advances up to 100% of your invoice value
  • Payments in as little as one day
  • Factor fees can add up
  • Processing fee: Approximately 3%

Fundera works with many lenders, ensuring applicants will have invoice factoring choices. Fundera lenders offer up to 100% of the invoice value, and payments may be received in just one day. This results in applicants getting fast access to working capital. Fundera lenders offer invoice factoring with somewhat flexible application terms, since the invoices serve as collateral.


Main Features

Fundera offers a simple online application that’s easy to complete. A Funding Advisor will then contact you to help identify the funding product that’s best for your needs. Fundera’s technology matches you with the products that you qualify for, and your Funding Advisor will help you to explore, evaluate, and compare each offer. Fundera’s invoice factoring options have a processing fee of approximately 3%. There’s also a factor fee of approximately 1% for every week until your invoice is paid. The sooner your invoice is paid, the lower your fees.

With the ability to source quotes from multiple funders, Fundera makes it easy to explore your options. A Funding Advisor will guide you through the process, answering questions and helping you perform detailed comparisons of your options.

Kapitus - Best for Customer Service

Min. Annual Revenue
Min. Time in Business
2+ years
Min. Credit Score
Key Features
  • Wide range of loan options
  • Efficient application process
  • No prepayment penalties
Pros & Cons
  • Factoring lines up to $7 million
  • Factoring rates start at just 1.5%
  • Receive funding 24-48 hours after approval
  • Help is available by phone
  • Free financial matching tool
  • Clients need to have credit in good standing
  • Underwriting takes 5 to 10 days

Kapitus has funded over 64,000 businesses and provided more than $3 billion in funding. Invoice factoring lines range from $200,000 to $7 million, making it a practical choice for both smaller businesses and large-scale businesses and corporations. The application and underwriting processes take between five and 10 days to complete, and once approved, you may receive funding within 24 to 48 hours. Kapitus offers a free financial matching tool that you can use to understand whether invoice factoring is right for you, and financing specialists are available by phone to help you explore your financing options.


Main Features


Kapitus invoice factoring applicants will need to provide an accounts receivable/payable aging report. They will also need articles of incorporation or a partnership agreement, a personal or corporate tax return, and a personal or corporate financial statement. While invoice factoring doesn’t pull applicants’ credit, your clients’ credit needs to be in good standing. During the underwriting process, applicants may need to provide additional documentation. Factoring rates start at 1.5%.

Kapitus offers invoice factoring lines up to $7 million, making it a good choice for both small and large businesses. Rates are competitive, and you can speak with financing specialists anytime by phone to help you along the way.

Rapid Finance - Best for Large Invoice Amounts

Min. Annual Revenue
Not disclosed
Min. Time in Business
Min. Credit Score
Key Features
  • Efficient application process
  • Great customer service
  • Generous lending limits
Pros & Cons
  • Advances up to $10 million
  • Positive online reviews: A+ with the BBB
  • Simple online application
  • Live business advisors available by phone
  • No information on funding time
  • No information on factor rates

Rapid Finance’s invoice factoring features large advance amounts that range from $20,000 to $10 million. The online application is brief, and once approved, funds are deposited into your business bank account. Dedicated business advisors are available to help you through every step of the invoice factoring process. Rapid Finance has an A+ BBB rating and a 5.0 Trustpilot score.


Main Features


Rapid Finance only requires a form of valid identification and unpaid invoices from a reputable creditor to apply. In general, Rapid Finance requires that your business sells to other businesses, not directly to individual customers. Your credit score will not matter as much with Rapid Finance, as they care more about the outstanding invoices and the payment history of those.

Rapid Finance offers advances up to $10 million, so it’s a good option for many different businesses, including those with large-scale invoice factoring needs. The application is easy to complete and doesn’t require you to dig out lots of documentation before finding out if you’re approved. Rapid Finance also has a positive online reputation that indicates it may be a good choice for financing needs.

How To Choose Best Invoice The Factoring Companies

  • Loan features - What are the invoice factoring terms? How long will the company attempt to collect on your invoices? 
  • Application process - How complicated is the application, and how much documentation do you have to provide? How quickly are applications approved, and when will you receive an advance? 
  • Factor rates and fees - Are the company’s factor rates competitive? What percentage of your balance will the company offer as an advance? 
  • Qualification process - Do you need a minimum credit score to apply? What other qualifications do you need to meet, like a business history, invoice balance amount, or invoice type requirement? 
  • Customer support - Can you get help from a live customer service representative? Is multi-channel support available, and are there supplemental information and tools available to help you? 
  • Online user reviews - What are other customers saying about the company on independent review sites like Trustpilot? 


Main Features of The Best Invoice Factoring Companies

CompanyMin. Credit ScoreMin. Time in BusinessMin. Annual RevenueLoan AmountFactoring Fees
CrediblyDoes not applyDoes not applyDoes not applyAdvances up to $400,0000.5 to 4.0%
LendziDoes not applyDoes not applyDoes not applyVariesVaries
FunderaDoes not applyDoes not applyDoes not applyAdvances up to 100% of invoice valueApproximately 1%
KapitusDoes not applyDoes not applyDoes not apply$200,000 to $7 million1.5% and up
Rapid FinanceDoes not applyDoes not applyDoes not apply$20,000 to $10 millionNot disclosed


What Is Invoice Factoring?

Invoice factoring describes the sale of unpaid invoices to a lender as a means of expediting the payments.. In essence, lenders are buying those invoices from you, usually at a healthy discount, in exchange for cash. The outstanding invoices are then paid to the lender, rather than your business. Once they get the payment, the lender pays you the difference.

If a discount approach is not employed (meaning the lender purchases 85% of your invoices, for example, versus the entire amount), the invoice factoring company charges a percentage-based fee on the aggregate amount of the invoices. Usually, it is applied upon receipt from the customer.


How Does Invoice Factoring Work?

When you apply to an invoice factoring company, you’re essentially selling your accounts receivable to that third party with a promise to repay the fronted money, along with an additional fee, upon collection. This fee can range from 0.05% to 5%, on average.

For example, if you sell $10,000 of invoices with a fee of 2%, you’ll pay $200 in charges. Some invoice factoring companies will chase the debts for you, while others expect you to handle the invoice collection.

This type of funding is specifically designed for businesses that have cash flow issues, which oftentimes stems from late-paying clients or clients with 30-, 60-, or 90-day payment agreements. It enables organizations to stabilize their cash flows and continue operations as normal.

Most lenders will offer between 80% and 100% of the total value of your outstanding invoices. You should bear in mind that the percentage fee will be on the value of the total invoice, regardless of how much you borrow. For example, the factoring company may only lend you up to 80% of a $10,000 invoice and charge a 2% fee. This means you only receive an $8,000 loan but will be charged a fee of $200, not $160.


Invoice Factoring Rates and Fees

The rates and fees you can expect with invoice factoring are as follows:

  • Factoring fee - This is the percentage of your invoices that the factoring company will take as a total. On average, this ranges from 0.05% to 5%.
  • Processing or origination fees - This is a one-off charge at the start of your borrowing period, structured as a percentage of the total value of the pertinent invoices. This usually ranges from 1% to 3%.
  • ACH and bank wire fees - As funds will be moving between several different banks (yours, your customers, and the factoring company’s accounts), you might be charged additional fees
  • Monthly minimum fees - If your client still hasn’t paid by the invoice deadline, you may be charged additional monthly fees. However, this won’t always be the case because when it bought your accounts receivable, the factoring company assumed the risk of non-payment.


Which Businesses Can Benefit from Invoice Factoring?

Any business that provides services to other businesses and receives invoices on a delay, such as 30-, 60-, or 90-days, can benefit. Types of businesses that apply include:

  • Manufacturing - Manufacturing companies often need to buy supplies well in advance of being paid the final invoice for a finished product
  • Companies with large amounts of inventory - Stocking up for seasonal demands, buying new products, and having inventory on hand for emergencies requires cash. E-commerce and retail businesses, for example, use invoice factoring to get their hands on cash.
  • Transportation and logistics - Invoice factoring covers daily expenses like fuel and salaries, while you wait for your clients to pay you
  • Staffing agencies - It can take several months for staffing agencies to get paid for placing new hires. Here, invoice factoring becomes an invaluable tool
  • Contractors - Many contractors are paid at least 30 days out from project completion. Invoice factoring can come in handy to front the expenses of the next project while waiting to be paid on the previous one.


Invoice Factoring Loans Pros and Cons

Invoice Factoring Pros

  • High rates of approvals - Invoice factoring has high approval rates, as credit scores and time in business aren’t as important.
  • Fast access to cash - Approvals are fast and you can usually get funding within 24-48 hours of approval.
  • Acceptance might not affect your credit score - Since the value of the invoices are the most important factor, some agencies may not even need to perform a credit check.
  • All financing is unsecured - The factoring company has shouldered the risk of any non-payment when it agreed to buy your receivables. This means all lending is unsecured and your assets aren’t at risk.
  • Open to most small businesses - You usually don’t need to be making significant amounts of cash each month to be eligible.

Invoice Factoring Cons

  • Loss of invoicing control - In most cases, the factoring company will take control of your invoicing. This leads to a small reputational risk and can make it harder to keep track of clients.
  • 1% - 5% of all invoices will go to the factoring company - Like any other form of lending, invoice factoring comes with a cost. Make sure you can afford the hit in order to manage your cash flow.


Final Thoughts

Invoice factoring is a fast, safe, and simple way to secure funding for businesses that struggle with cash flow. If you’re wrestling with a funding dilemma and have multiple unpaid invoices, inquire with one of the platforms on our list. You’ll find some impressively low factor charges, lenient eligibility requirements, and a variety of flexible lending options to consider.

Frequently Asked Questions(FAQ)

Does invoice factoring require a credit check?

Not always. Whether invoice factoring requires a credit check depends on the funder. Most funders put more emphasis on your clients’ credit and payment history, but some funders do consider an applicant’s credit, too. To increase your chances of approval, submit invoices from clients who have a good history of paying on time.

Is invoice factoring right for your small business?

Invoice factoring allows you to get working capital quickly and improve your cash flow. It can be ideal if you have a lower credit score, since most of the emphasis is on your clients’ credit history. You also need to be providing products or services to other businesses, not individuals directly, and have outstanding invoices.

Is invoice factoring worth it?

It’s important to consider whether invoice factoring is right for your situation. If your clients have poor credit scores, you might not be approved. Factor rates will reduce the amount of each invoice that you collect, and even if a factoring company buys your invoices, that company can’t guarantee that they will be able to collect outstanding invoices. You’ll need to weigh the pros and cons and consider the value of your outstanding invoices to decide if it is worth it.

What's the difference between factoring and invoice financing?

There are a few key differences between invoice factoring and invoice financing. When you use invoice factoring, you sell all of your outstanding invoices, and the invoice factoring business approaches your clients to collect on those invoices. With invoice financing, you don’t sell any invoices, but rather borrow money directly from a lender and pay it back, with fees. You retain more control over the process and can approach your clients to collect on those invoices.

How do you qualify for invoice factoring?

While qualification requirements for invoice factoring differ between funders, in most cases, you’ll need to be a business that is located and operating in the United States. You will likely need to be a B2B business that sells to other businesses. Most funders also require that your invoices pay on 30-, 60-, or 90-day terms, and that your funders have a good history of making payments on time.

How much do invoice factoring companies charge?

Invoice factoring companies charge several fees that can affect how much you will make off of your invoices. Invoice factor fees can range from approximately 0.5% to 5%. The company will charge you that percentage of your invoice balance while your invoices remain unpaid, so the longer it takes to collect payment, the less money you will receive. Most lenders also charge a one-time processing fee, too.

About the Author

Written by: Paige Cerulli

Business Content Writer

Paige Cerulli is a content writer and copywriter who specializes in business, finance, pet, and health topics. An entrepreneur herself, Paige enjoys writing about topics that help business owners to make well-informed strategic decisions.

More about me
Sarah Brooks

Reviewed by: Sarah Brooks

Personal Finance Writer and Editor

Sarah Brooks is a personal finance writer and editor with more than 10 years of experience. She specializes in personal and business loans, mortgages, auto loans, and credit cards.

More about me
Thomas Brock

Fact checked by: Thomas Brock

Chartered Financial Analyst (CFA) and a Certified Public Accountant (CPA)

Thomas is a well-rounded financial professional, with over 20 years of experience in investments, corporate finance, and accounting. He currently oversees the investment operation for a $4 billion super-regional insurance carrier, maintaining a dynamic investment policy designed to preserve capital, enhance...

More about me

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