Dollar Notes

Find the Lowest Rates on Invoice Financing

Invoice financing helps businesses improve cash flow, pay employees and suppliers, and reinvest in operations and growth earlier than they could if they had to wait until their customers paid their open invoices in full.


Loan Amounts

Up to 100% of Invoice value

Interest rates

15% – 35% Overall Annual Percentage Rate

Repayment Terms

Until the customer pays the invoice

Turnaround Time

As little as 1 business day


Types of Receivable Financing

Invoice Factoring

Invoice Factoring is a common variant invoice financing for small businesses in industries like clothing or manufacturing, where long accounts receivable are part of the normal business cycle. Factoring works by providing a cash advance based on the total value of the unpaid or outstanding invoices. You typically receive 50-80% of the invoice value up front (also known as invoice discounting) based on the risk profile of your clients. You receive the remaining value once the client pays off the invoices, minus a factoring fee. This fee can be structured in any number of ways, but it generally nets out to be about 3-5% of the invoice value.

Invoice Financing

Invoice Financing for small business is like factoring except that it’s not a sale of your accounts receivable. Invoice financing works by using account receivables as collateral to get the advance and you are ultimately responsible for managing the customer relationships and collecting payment, including late payments. If your customer payments become delinquent, you will be responsible for the amount you advanced. The fees are usually 2-4% of your invoice value per month

Receivable Based Line of Credit

Receivable Based Line of Credit is a credit line based on a percentage (usually of 80-85%) of value of your outstanding invoices. The value is calculated based on the *aging* of the invoices. Namely, they give a full value for current invoices and a discount for unpaid invoices. You will pay a pre-negotiated interest rate based on your balance. When an invoice gets paid, your balance will be reduced. There’s usually a fee when you draw the credit line. But this is usually a cheaper option than invoice factoring or invoice financing with APR less than 20%.



- Fast approval, minimal paperwork
- Helps mitigate cash flow emergencies
- Transparent, easy-understandable pricing

If you’re looking for a fast way to get a short-term borrowing type of financing, invoice financing could be a solid option. Because you’re essentially looking to sell your invoices, the focus is heavy on the invoices themselves.

This type of small business finance can also help alleviate some of the financial pressure that comes while you wait on tardy customers to pay the invoice. At the same time, the clear terms from the origination fee to the interest rates can make this an easy choice when you’re looking to borrow money.



- Relatively high rates

- Need invoices as proof/collateral

- Generally doesn’t work for B2C businesses

The con right off the bat is the high cost of invoice financing. While quick approvals can help you solve financial woes a bit quicker than traditional loans, the overall cost may lose you a little more money in fees, etc. 

The need of invoices as collateral to finance can also be a prohibitive detail to some types of businesses. B2C businesses looking for financial help may be out of luck, especially if their cash flow originates at a point of sale machine rather than long-term invoices. As well, the discount rate you’d receive for your invoices means that you’re essentially losing out on the cost of the full invoice which may have come over time. 


What You Need to Know About Invoice Financing

Best Candidates for Invoice Financing

  • B2B Businesses

  • Seasonal Businesses

  • B2B Businesses with Big, Well-Respected Clients

  • Businesses in Industries with Long Billing Cycles — e.g. Clothing, Retail, Manufacturing, etc.

  • Businesses with Large Invoices and Purchase Orders

Industries Best Suited for Invoice Financing

  • Retail

  • Manufacturing

  • Real estate

  • Healthcare services and medical suppliers

  • Agriculture

  • Marketing services

  • Business consulting and legal services

Invoice funding or financing is not a great fit for business-to-consumer (B2C) companies or subscription-based revenue companies.

Requirements to Qualify for Invoice Financing

Because of the heavy focus on the invoices themselves, almost any B2B business can qualify for invoice financing. If the invoices themselves make sense for the lender to finance, they most likely will. 

The finance amount will depend on the quality of the invoices and your credit history, which you’ll want to review before applying. Be sure, as well, to take a long look to make sure that it makes sense for you to finance your invoices, as it may be costlier than you’re willing to handle over time.

How do You Apply for Invoice Financing?

Compared to many small business financing options, the application process for invoice financing, invoice funding, or invoice loans for small businesses is a pretty quick and simple way to get cash for your business. If your chosen lender or financing provider has an online application, all the faster. 

Like with small business loans, your lender will have various requirements for your application, but the unpaid invoices will be the most important. Some may look at your personal credit or business credit or business financials. It’s best to ask before you begin the process to know where you may have the best chance for approval. Some may work better with bad credit, others may be a better fit for younger businesses or those with lower annual revenue, so it’s worth your time to investigate.


Get the money to grow your business.

Speak with a Funding Specialist. There is no way to see what you qualify for without an expert reviewing your specific situation. We can do that without cost, obligation, or even a credit inquiry.

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