How does Invoice Factoring work?

Invoice Factoring is a full-service billing solution for companies and their customers. Businesses can submit invoices to their factoring company, called the “factor,” and receive a cash payment within 24-hours, instead of waiting for slow-paying clients for 30 days or more, depending on payment terms. The factoring company handles credit and collections for a small “factor fee.”

What can a factoring company do for me?

At ProBilling, our services don’t just improve your cash flow. They also simplify your day-to-day operations and allow your staff to have more time to serve your customers or devote their skills to other needs.

How do I apply for Invoice Factoring?

Working with ProBilling requires less overhead and paperwork to get started than traditional business loans. The application process is easy:

  1. Apply quickly
  2. Send our underwriting team any other requested documents, including a list of customer accounts, tax returns, and other AR info.
  3. We’ll process your request quickly.
  4. Once approved, we’ll do an in-depth, on-site training with your accounting personnel.

I already have someone who handles accounts receivable in my business. What do I do with them?

ProBilling handles many of your AR responsibilities, including collections, processing customer credit applications, and fielding billing questions for your customers.

Hiring us to handle these duties saves many businesses money because their AR department requires less personnel. However, you will still need staff to submit invoices, run reports, and act as the liaison between your company and ProBilling.

Some businesses combine the accounts payable and accounts receivable roles into one. Others delegate office duties to several departments. We’ll help you navigate the best solution for your business.

What’s the difference between recourse and non-recourse?

ProBilling offers two structures of service management: recourse and non-recourse.

Recourse services are a billing solution where your business is liable for any uncollectible invoices you submit within a specified period. Certain business models work well within this structure, such as trucking and logistics, manufacturing, or professional services.

Non-recourse services are where your business is not liable for any uncollectible invoices. Companies that work well with this solution are truck/automotive parts and service operations, heavy equipment services, and industrial services.

How much does Invoice Factoring cost?

Typically, the cost of a full-service billing solution is less than credit card processing fees. Our rates are calculated using several factors:

  1. The volume of the monthly receivables you will be submitting
  2. The average size of the invoices your company generates
  3. Your industry
  4. The creditworthiness of your customers
  5. The length of time it takes your customers to pay

Does Invoice Factoring replace other financing sources used for cash flow, such as operating from a line of credit?

Lines of Credit have been a staple in the business world for many years and can provide quick access to funds when you need them. Unfortunately, they are also restrictive because your assets and cash flow determine your credit line.

Accounts Receivable Factoring is a funding solution that depends on the invoices you submit. This method provides you with unlimited funding potential for your business and a flexible source of cash during a period of growth when you need it most.

If you currently use a line of credit to supplement your cash flow for your receivables, we have simple solutions for an effortless transition to ProBilling. Contact us to learn more.

Invoice Factoring vs. Bank Loan

Trying to choose between Invoice Factoring and a Bank Loan? The choice is easy:

Bank Loans

You incur debt
Approval takes weeks or months
Must have excellent credit
Usually a one-time loan
Increasing your credit line is VERY difficult
Must be in business for at least 2 years

Invoice Factoring

Debt-free financing
Approval takes days
We work with all credit situations
Ongoing funding whenever you need it
Flexible funding that grows with your business
We fund small businesses and startups

Get Started

The PRocess

Applying is fast, easy, and requires minimal paperwork. Start by filling out an application in just a few minutes. We’ll need a few additional documents from you to process your information. The approval process is fast, and we’ll work with you to develop a funding option customized for your business.

When you join ProBilling, we’ll assign a team member to be your dedicated account rep and come to your business to provide your AR department with in-depth, on-site training. You’ll have access to next-day funding anytime you have new invoices to submit.

Start My Application