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Turn unpaid invoices to business customers into cash through one of our direct lending partners, or weigh it against working capital we fund in house.
Invoice factoring turns invoices your business customers have not paid yet into cash now: a factor buys the invoices, advances most of their face value, collects from your customers and returns the balance less its fee. Full Send Funding arranges factoring through direct lending partners rather than buying invoices itself. We talk through your options with you first, and a factoring arrangement is placed with a partner only when it is the better fit and only at your discretion. Placement is free: we charge no fee for arranging it, and the partner’s written terms state its full cost before you sign. What we fund in house is working capital, which leaves your invoices and your customers out of it entirely.
Factoring is a sale, not a loan, and that shapes everything about it. The factor underwrites your customers rather than you, because they are the ones who pay, so a young business with a few creditworthy commercial customers can be a workable file where its own history would not support a bank line. On notification terms your customers are told in writing to pay the factor, and once they have that notice, paying you instead does not settle the invoice. The fee is charged on the face of the invoice, often in steps of time, while the cash you receive is only the advance, so the cost on the cash in hand runs well above the headline percentage.
Read three terms before anything else; the partner sets all of them out in writing before you sign. Recourse decides who carries an invoice that is never paid: under recourse it comes back to you, and non-recourse usually covers only a customer's insolvency, not a dispute or a short-payment. Notification decides whether your customers know. And the filing: a factor usually files a UCC-1 against the receivables it buys, which blocks a bank line against the same invoices until it is released. Minimum volumes and termination fees are the two terms that keep a business factoring after it could have qualified for something cheaper.
A factoring partner advances a share of each invoice's face value, holds the rest as a reserve until your customer pays, and states the advance, the fee schedule and the reserve terms in writing before you sign. What is available moves with your invoices and your customers' credit rather than with your deposits. If working capital we fund in house fits the gap better, it is sized from your deposits instead: 80%–150% of average monthly revenue, within $5,000 to $10 million, with no invoice sold and no customer notified.
Yes, through direct lending partners. We arrange factoring and do not buy invoices ourselves. Working capital and unsecured funding are what we fund in house and the core of what we do. When factoring is the better fit for your business, we talk the options through with you and place it with a partner at your discretion, on the partner's terms, which are set out in writing before you sign.
You do. Your application comes to us, and we talk through what fits before anything goes anywhere: often that is working capital we fund in house, which needs no aging and involves no one but you. If factoring suits your customers and your cash cycle better, the file goes to a direct lending partner only with your agreement. We do not shop it around, send it out wide or hand it to a broker.
Usually, yes, because non-notification terms are rarely granted at the outset. On notification terms your customers receive a written notice directing payment to the factor, so their payables team will know. Non-notification, where customers keep paying a lockbox in your name, is offered to stronger files at a higher cost and usually converts to notification once an invoice goes past due. If your customers must not be involved at all, working capital we fund in house leaves them out: they keep paying you as they do now.
Because the fee is charged on the face of the invoice while you receive only the advance, and because it is usually charged in steps of time rather than by the day. An invoice paid one day into a new step pays for the whole step, so the annualized cost jumps at each boundary, and the boundaries tend to fall where commercial customers actually pay. Compare offers in dollars of cost per dollar of cash in hand, for the days you actually had it.
Not against the same invoices. A factor and a receivables lender both file against your receivables, whoever files first has priority, and the second will not advance against collateral the first already holds. The filing stays on record until it is terminated, so ask for the termination in writing the day the last factored invoice clears. Our own working-capital agreements carry no UCC-1 lien against the business on the deal sizes our FAQ states, which is why such an advance we fund in house leaves the ledger free for a later bank line.
More than paying off a loan. The factor's filing against your receivables stays on record until a termination statement is filed, a minimum volume commitment charges the fee on any shortfall, and a termination fee charges a percentage of the facility limit for leaving before the initial term ends. All three are negotiable at signing and rarely afterwards, so ask for the initial term, the minimum, the termination fee and how the filing is released before you sign.