GET A FREE, NO-RISK QUOTE

What Do Invoice Factoring Companies Do?

Invoice factoring companies provide multiple benefits to organizations that factor invoices. 

Invoice factoring companies (also known as Factors) enable other organizations to get immediate access to working capital tied up in unpaid customer invoices for a small percentage fee (often between 5% and 10% of the invoice amount) called a factoring fee. The factoring fee is the cost of using invoice factoring as a working capital and cash flow solution.

Traditionally factoring has mainly been utilized by B2B (business-to-business) sellers who invoice their customers on terms. However, factoring is also available to eCommerce businesses and sole proprietors who sell on third party platforms such as Amazon, Zulily, Poshmark, etc., app and software developers, agencies, and others who earn payments from a third party and then wait on promised payments, often for weeks and even months.

The services provided by invoice factoring companies also facilitate competitive advantages for their clients. Since slow-paying customer accounts are no longer an impediment to cash flow, organizations that factor invoices can also extend more generous payment terms to their customers, creating a competitive advantage for them in the marketplace.

What do factoring companies do, and what sets the best invoice factoring companies apart?

What Sets the Best Receivables Factoring Companies Apart?

There are many small details which set invoice factoring companies apart — small details that turn into big advantages when you choose to work with one of the best invoice factoring companies. These are all the same details we incorporate into our invoice factoring program so that we can help our clients grow more quickly.

The best invoice factoring companies…

… have transparent fee structures.

Some invoice factoring companies seem to offer a low factoring fee on the surface; however, when additional fees (application fees, funding and notification fees, account handing and scheduled processing fees, etc.) are tallied up, the cost of factoring invoices with these companies is actually much higher. Depending on how our clients choose to receive funding, their factoring fee might be their “all in” cost of financing, since we don’t tack on administrative fees or charge for due process.

It’s also important to be aware that some factoring companies offer what looks like small fee, but a closer look at contract details reveals that they apply that fee weekly or in some other frequent way so that the real factoring fee you pay is much higher than you anticipated, especially if there is a delay in payment from your customer (or the third party platform).

… offer competitive fees and high advances.

Organizations that factor invoices usually do so in order to free up working capital by expediting – or speeding up – business cash flow. High factoring fees, large reserve amounts held back and low advance rates can all reduce the benefits of invoice factoring. We offer competitive factoring rates so you can grow your business more quickly.

… provide professional customer service and knowledgeable account managers.

Invoice factoring companies with poor customer service can have a negative effect on your business since they interact directly with your customers. Having a knowledgeable account manager means that you will be working with someone who will be held accountable to providing a high level of customer service.

We provide great customer care and a knowledgeable, dedicated account manager. We will service your account based on your preferences and strive to learn more about the unique needs of a your business, in part, to make sure you’re getting the maximum benefits from factoring.

If you want to minimize or eliminate the contact between your customers and Corsa Finance, we also offer non-notification invoice factoring which – in effect – “white labels” our services so you can provide your clients with a seamless brand experience.

… don’t require long term contracts or hidden fees.

When a factoring company is truly delivering when it comes to low fees, high advances, fast funding and professional customer service, they become a true financing partner who is invested in earning repeat business and referrals. Locking clients in to long term contracts or requiring clients to factor a monthly minimum amount of customer invoices may not be what is best for their business.

We want to earn your repeat business and referrals. With Corsa Finance, you retain control of when and which invoices you want to factor. We operate transparently, so you won’t be surprised with hidden fees or penalties that make it more difficult for you to do what’s best for your business.