Best Factoring Companies

Sell your invoices to get capital now

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In the U.S. alone, over 30% of small businesses experience or expect to experience late or unpaid invoices and their ill effects that hurt company investments, supplier payments, and payroll. Fortunately, you have options to avoid these hardships.

Factoring occurs when a company sells one or more accounts receivable invoices owed on credit terms to a financier, known as a factor, for less than what they are owed. That discount, plus some additional fees, is how the factoring company makes its profit. The factoring firm (hopefully) collects the full amount of the invoice owed from the original business’s customer.

Why would a business sell their invoice for less than what they are owed? Sometimes short-term debts exceed cash on hand. Therefore, a business will sell enough invoices to collect cash immediately from a factor in order to make their short-term debt payments. It’s not a position a business wants to be in, but it is a financial tool to boost cash flow when needed.

For example, Company A sells a product to Customer B for $50,000 with payment due in 60 days. Company A owes $30,000 to one or more of its suppliers in 30 days. Company A would sell the $50,000 invoice to Factor C for 90 cents on the dollar, or $45,000. Factor C may pay this in one lump sum or on a schedule to reduce risk.

As you can see from this example, invoice factoring is a sale, not a loan, like invoice financing. 

We reviewed 14 factoring companies to help you find the right one for your business needs. To select the best of these options, we analyzed each company’s reputation, fees, credit requirements, speed of funding, invoice management features, integration to your accounting software, funding minimums and maximums, and their repayment terms. Here are our top picks.

Best Factoring Companies of 2022

Best Overall : altLINE



We chose altLINE as our best factoring company for large invoices because, as a commercial financing division of The Southern Bank, it is a direct financier and transparent to the business customer. As a result, it doesn’t have the middleman fees that are typically a percentage of the invoice, which saves more money on a large invoice.

  • Provides a wide range of factoring options

  • Discount rates as low as 0.50%

  • Supported by a reliable banking institution

  • Funds may not be instant

The company has provided more than $800 million in funded invoices since 1936. Unlike most factoring companies, altLINE is backed by an established, reputable bank, The Southern Bank Company. altLINE is our preferred choice for large invoice factoring because, as a direct lending company, altLINE doesn’t carry additional borrowing costs that can become expensive on large invoices. While we hear its upper limit on invoice value may be a bit lower than a few of its competitors, we still selected it as best for large invoices because it keeps its fees transparent and charges fewer of them, which lowers the cost for the business customer with a large invoice.

Their factoring rate can be as low as 0.50%. Other fees that may apply are for origination, wire transfers, and to speed up funding.

The company does not use credit score as a primary consideration. However, the specific rate will be determined partly by the customer’s credit and capacity to pay their invoices.

To work with the company, altLINE you may need to meet certain requirements around the amount of annual sales you have and the amount of invoices you need to factor.

You can request a quote on altLINE’s website. After completing the request, an altLINE specialist will work with you to determine if factoring is the right service.

The main drawback altLINE has compared to its competitors is the possibly slower funding timeline. It may take a couple of days to get your money, however, your experience may be more or less. The application process, however, is fast and does not require an application fee.

Minimum and maximum factoring amounts may apply.

Best for Invoice Management : Triumph Business Capital

Triumph Business Capital

 Triumph Business Capital

We chose Triumph Business Capital as our best factoring company for invoice management because of its online MyTriumph web portal. This portal provides a full array of client reporting and allows businesses to monitor the status of their invoice payments.

  • Ability to run credit checks and see the status of transactions in their portal

  • High advance rates, up to 100%

  • Fuel discount program

  • Not as much fee transparency as their competitors

Headquartered near Dallas, Texas, Triumph Business Capital has offered invoice factoring since 2004. The company launched which is an industry-leading web portal built for customers to manage their funding. This portal is why we awarded Triumph as the best factoring company for invoice management. Customers can stay up to date on their account from anywhere with real-time information by logging into their MyTriumph dashboard to view requests, payments, invoice searches, and to get immediate support from their customer service team.

Triumph offers an advance rate of up to 100%. Things such as age of your business, yearly revenue, invoice examples, and more may be examined to determine your eligibility to be a Triumph customer. Business owners must also have business-to-business or business-to-government sales invoices to qualify.

Fees vary in size and form. In some cases, there are flat fees, and in others, there are variable rates. It depends on what you negotiate with Triumph. Triumph Business Capital works with the business to fit their budget and terms requirements. Once inside the portal as a client, you’ll have ready access to your invoice management fee structure.

Interested businesses may apply by phone or through a form on the company's website. Just like the other factoring companies, a specialist will be in contact after submission. Triumph says they provide same day funding, but keep in mind, it could be longer than that.

The MyTriumph portal is robust and easy to use as you can see where your requests stand in the funding approval process. There is, however, no direct integration to sync your bookkeeping software, but you can download and upload files through an import and export process.

Triumph determines its invoice funding amount on a case-by-case basis. Triumph then recoups the money by collecting on your invoices.

Best for Trucking : RTS Financial

RTS Financial

 RTS Financial

We chose RTS Financial as our best invoice factoring company for trucking because the company specializes in trucking and the freight industry. The company provides credit reports, fuel card programs, and trucking-related software with a mobile app.

  • Offers mobile apps and web browser apps for better integration with their platform

  • No hidden fees including ACH and invoice uploading

  • Gives fuel card discounts

  • Funds within 24 hours

  • Up to 97% of invoice value paid upfront

  • You don’t find out about the rates they offer until after you’ve submitted a full application

  • Must apply via contact form and then phone call

  • Has complaints about difficulties in getting out of contract and cancellation fees

RTS Financial, a factoring company founded in 1986, offers working capital solutions to businesses across multiple industries, but with a clear focus on the trucking industry. RTS Financial is our best choice for trucking industry invoice factoring because it offers apps for both web browsers and mobile. It also serves truck driving companies with same-day funding, a discount fuel card program, a solution for trucking companies operating in Mexico, credit reports for freight brokers, and comprehensive fleet management software.

The company does not disclose its pricing and rates until after you’ve applied. RTS does not charge hidden fees such as ACH fees or invoice-upload fees.

For the invoice factoring service, the company will advance up to 97% of the total amount within 24 hours of taking your application. 

Requirements for RTS will differ by industry (trucking and non-trucking) and if it is domestic or international among other possible factors.

To apply with RTS Financial, you need to submit the contact form online. A representative will then call you and take your application over the phone. In the application conversation, you’ll submit personal and business information, truck details, company ownership, and more. After the submission review, a representative from RTS Financial will contact you again to discuss your qualification and options. Funding can be as quick as 24 hours once approved.

The company provides a mobile and web application called RTS Pro to help clients access fuel discounts and available loads, upload invoices for factoring, access free credit data on brokers, and manage load history. They also offer a separate full-service trucking software called ProTransport that offers load management and tracking, two-way driver communication, and integrations with QuickBooks.

Funding minimum and maximum amounts are determined on a case-by-case basis depending on the company's full understanding of your financial picture. For Fuel Card allowances, RTS permits up to $2,500 per truck, per week. As customer invoices are paid, the remaining payments are made to the trucking business.

Best for Small Businesses : eCapital



We chose eCapital as our best invoice factoring for small businesses because their comparatively low rates are helpful for smaller companies that need to retain more of their profit to survive. eCapital works with small to medium-sized businesses and is a good option for businesses that are struggling to get invoice factoring.

  • Non-recourse factoring

  • Works with small and new businesses

  • Fast payment within 24 hours

  • Up to 90% advanced

  • Decent rates

  • Financing options could become expensive if customers don't quickly pay invoices

eCapital has bought over 12 million invoices and worked with 17,800 clients in its long history. With offices in California, Tennessee, and Ontario, Canada, eCapital earns our top nod for small business invoice factoring because of its clear willingness to work with startup and smaller firms accompanied by a lack of requirements that would exclude such businesses. Its rates are also relatively competitive too. The company offers non-recourse factoring for bankruptcy protection and weighs the customer’s ability to pay far above the personal credit of the business owner.

Rates for small business factoring are 3.5% per invoice. For larger businesses and truck fleets the rate is likely cheaper. Their advance rate is up to 90%.

You may pay additional fees depending on your business and situation. Of course, additional services will likely carry additional fees too.

eCapital works with startups and has no requirement for length of time in business. eCapital appears more concerned with the customer’s ability to pay the invoice than credit history of the business owner as they say that they work with those unable to get bank financing.

The process starts with a contact form which leads to a conversation with one of their representatives. eCapital has the potential to advance your funds within 24 hours after signing the agreement.

The company offers its client portal login on nearly every page of their website, allowing you to easily view and manage your account as well as receive funds.

For small business factoring, the amount you receive must be less than $250,000.

What Does Factor Mean in Financing?

What Is Factoring?

Invoice factoring is a mechanism for businesses to inject cash into their accounts by selling their invoices to a third party at a discount. Companies get immediate cash for their unpaid invoices that are due within 90 days, instead of waiting for their customers to pay their financial obligations.

This funding option is best for businesses that need immediate cash to pay bills or make a large purchase, such as inventory. Factoring is best used as a short-term funding option because fees can be expensive if customers take more than 30 days to pay their invoices.

How Much Does a Factoring Company Charge?

A factoring company charges the business client a factor fee, which is the fee they charge for the advancement of funds. A good way to think of this fee is as a discount rate. For example, if the factor fee is 1% on a $30,000 invoice, then the fee is $300. Keep in mind, the 1% rate in this example is likely to grow to 2% on a weekly basis, and by the third month, expect 5%.

Factor fees often scale from 0.75% to 5%. The longer it takes your customer to pay off the invoice in full to the factoring company, the higher the factor rate climbs over time.

Is Invoice Factoring Worth It?

Invoice factoring is best used when a business needs cash to fund inventory purchases or payroll and has invoices that are due in less than 90 days from customers with good credit. The business can turn those invoices into immediate cash to manage their business.

Factoring may not make sense if you as a business owner have good credit, a low debt-to-income ratio, and you don’t need the cash within a week. In this case, a long-term business loan or line of credit would be a better fit because the effective interest rate will be much lower.

What Is the Difference Between Invoice Financing and Factoring?

Invoice financing and invoice factoring both provide funding to a business in need of cash to accomplish its goals, such as making payroll, paying its vendors, or buying more inventory.

They differ on one important point, however. Invoice financing is a loan, and invoice factoring is a sale. A business that uses invoice financing gets a loan from a bank that lends on the value of outstanding invoices it has. You’ll need to make payments like any other loan, and your business will still be collecting payments from your customers per usual.

Invoice factoring occurs when a business sells its invoices to a factoring company at a discount in exchange for immediate cash. The factoring company then owns the invoices and collects payment from your customers.

How We Chose the Best Factoring Companies

We reviewed 14 factoring companies to select the best five. We researched their factor fees, advance rate percentages, credit score eligibility requirements, minimum and maximum funding limits, invoice management processes, repayment terms, overall process duration, and bookkeeping software integration. As a result, we found four great factors that excel in different categories ready to help you with this long-standing business finance tool.

Article Sources
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  1. Sage. “Late Payments: Why Your Invoices Are Delayed and How to Get Them Paid Faster.