Business Capital

Invoice factoring: turn unpaid invoices into cash today.

Truidian helps businesses identify and connect with third-party invoice factoring companies, so B2B invoices on net-30 to net-90 terms don’t have to sit unpaid while bills come due. Truidian is not a factoring company or lender.

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How it works

Understanding invoice factoring.

Invoice factoring

How does invoice factoring work?

Invoice factoring is a financing arrangement in which a business sells eligible unpaid B2B invoices to a factoring company in exchange for an advance, rather than waiting for its customers to pay.

The factor typically advances a large portion of the invoice value within a day or two, then remits the remaining balance — less its fee — once the customer pays in full. Because underwriting usually focuses on the creditworthiness of the business’s customers rather than the business itself, factoring is often available to newer or thinly capitalized companies that invoice established commercial or government customers.

Recourse factoring means the business remains responsible if a customer never pays; non-recourse factoring shifts some of that credit risk to the factor, usually for a higher fee. Some programs require every invoice to be factored ("whole ledger"), while others let a business factor selectively, invoice by invoice.

Accounts receivable financing is a related but distinct structure: invoices serve as collateral for a loan or line of credit rather than being sold outright. The two are often compared side by side for the same cash-flow problem.

Commonly explored when

Commercial or government customers pay on net-30 to net-90 terms
Revenue is growing faster than the cash coming in from collections
A bank loan or line of credit isn’t available yet because of time in business or financials

What to compare

What actually differs between factoring providers.

Advance rate
Most factors advance 80–95% of an invoice’s face value up front, with the remainder paid out — minus fees — once the customer pays.
Fees
Factoring fees are commonly charged as a percentage of the invoice per month or in tiers tied to how long it takes the customer to pay.
Customer notification
Most factoring requires notifying the customer to redirect payment to the factor. Non-notification programs exist but are less common and carry different pricing.
Contract terms
Recourse vs. non-recourse, minimum monthly volumes, contract length and early-termination terms vary significantly by provider and are worth comparing line by line.

FAQ

Common questions about invoice factoring.

Is Truidian a factoring company?

No. Truidian is a business solutions company, not a factoring company or lender. Truidian helps businesses identify and connect with third-party factoring companies. Any factoring arrangement is offered by a participating provider and is subject to that provider’s underwriting, approval and terms.

Which businesses typically qualify for invoice factoring?

Factoring eligibility is driven largely by the creditworthiness of the business’s customers, since the factor is advancing against invoices owed by those customers. Businesses that invoice other businesses or government entities on 30- to 90-day terms are the most common fit.

What does invoice factoring cost?

Cost varies by provider, invoice volume, customer credit quality and how long invoices take to be paid. Fees are typically charged as a percentage of the invoice value, often in tiers based on days outstanding. Specific pricing is set by the participating provider.

What is the difference between recourse and non-recourse factoring?

In recourse factoring, the business remains responsible if a customer ultimately doesn’t pay. In non-recourse factoring, the factor absorbs more of that credit risk, typically for a higher fee. Terms vary by provider and by customer.

Tell us about your invoices.

Share how you invoice customers and how long they typically take to pay. We'll identify participating factoring providers whose programs may fit.

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Truidian is not a factoring company or lender. Financing is offered by participating third-party providers and is subject to their underwriting, approval and terms. Truidian does not guarantee approval, rates, amounts or timing.