Invoice Financing: Turn Receivables Into Immediate Cash
Unlock the value of your accounts receivable with invoice financing. Get immediate access to cash tied up in outstanding invoices without waiting for customers to pay.
Improve Cash Flow Without Adding Debt
Invoice financing accelerates your receivables without creating new debt on your balance sheet.
Immediate Cash Flow
Convert unpaid invoices to cash within 24-48 hours
Simple Qualification
Based on your customers' creditworthiness, not yours
Scalable Funding
Financing grows as your sales increase
What is Invoice Financing?
Invoice financing is a funding solution that allows businesses to receive an advance on their outstanding invoices. Instead of waiting 30, 60, or 90 days for customers to pay, you can access up to 90% of the invoice value immediately, improving your cash flow and enabling you to cover expenses or pursue growth opportunities.
This flexible funding option is particularly valuable for businesses that experience cash flow gaps due to long payment terms or seasonal fluctuations. It provides the working capital you need without adding debt to your balance sheet.
Key Characteristics of Invoice Financing
- Advance rates of 70-90%
Receive the majority of your invoice value upfront, with the remainder (minus fees) paid when your customer pays
- Fee-based structure
Pay a small percentage of the invoice value (typically 1-5%) rather than traditional interest
- Quick funding
Receive funds within 24-48 hours of invoice submission once your account is set up
- Minimal documentation required
Typically just invoices, customer information, and basic business documents
Invoice Financing Market Growth
The invoice financing market continues to grow as more businesses discover its benefits. With traditional bank lending remaining restrictive for many small businesses, alternative funding options like invoice financing have seen significant adoption.
$3T+
global accounts receivable market
24-48h
average funding time
85%
typical advance rate
How Our AI Finds Your Perfect Invoice Financing Solution
Lendec's proprietary AI technology analyzes your business profile and matches you with the right financing provider.
Invoice Analysis
Our AI analyzes your invoicing patterns, customer payment histories, and industry benchmarks to understand your unique financing needs.
Provider Matching
The AI compares your profile against our database of financing providers to identify those most likely to approve your application with favorable terms.
Rate Optimization
Our system predicts the advance rates and fees you're likely to qualify for and negotiates with providers to secure the most competitive terms.
Funding Facilitation
Once matched, our platform streamlines the application process, document submission, and funding to get you capital in as little as 24 hours.
Types of Invoice Financing
Different invoice financing structures to meet your specific business needs and customer relationship preferences.
Invoice Factoring
Sell your invoices to a factoring company at a discount in exchange for immediate cash. The factoring company takes over collection from your customers.
- Advance rates: 70-90%
- Factor handles collections
- Customers typically notified
Invoice Discounting
Use your invoices as collateral for a loan. You maintain control of your customer relationships and collect payments yourself, making this a more confidential option.
- Advance rates: 70-85%
- You handle collections
- Confidential (customers not notified)
Selective Invoice Finance
Choose specific invoices to finance rather than your entire sales ledger. This offers flexibility for businesses with occasional cash flow needs.
- Finance individual invoices
- No long-term commitment
- Higher fees but more flexibility
Supply Chain Finance
A buyer-led solution where suppliers can receive early payment on their invoices based on the buyer's stronger credit rating.
- Lower rates based on buyer's credit
- Strengthens supplier relationships
- Ideal for large corporate suppliers
Which Invoice Financing Type Is Right For You?
Choosing the right invoice financing structure depends on your business's specific needs, customer relationships, and cash flow patterns. Our AI technology analyzes these factors to recommend the best option:
- Choose invoice factoring
If you want to outsource collections and don't mind customers knowing you're using financing
- Choose invoice discounting
If maintaining confidentiality and customer relationships is important to you
- Choose selective invoice finance
If you only need occasional financing for specific invoices or customers
- Choose supply chain finance
If you supply large corporations with strong credit ratings
How Different Industries Use Invoice Financing
Discover how businesses in your industry leverage invoice financing to solve cash flow challenges and fuel growth.
Manufacturing
- Fund raw material purchases
- Cover production costs while waiting for payment
- Manage seasonal production demands
- Invest in new equipment
Wholesale Distribution
- Purchase inventory in bulk
- Bridge payment gaps with suppliers and customers
- Expand product lines
- Take advantage of supplier discounts
Professional Services
- Cover payroll during client payment delays
- Fund new project startup costs
- Invest in marketing and business development
- Manage cash flow with long billing cycles
Staffing & Recruitment
- Meet weekly payroll obligations
- Scale operations during growth periods
- Cover benefits and employment taxes
- Expand into new markets or industries
Success Story
"As a manufacturing business, we were constantly struggling with cash flow due to our 60-day payment terms. Invoice financing through Lendec gave us immediate access to 85% of our invoice values, allowing us to take on larger orders and negotiate better terms with our suppliers. The AI matching found us a provider with rates 1% lower than we'd found elsewhere."
— Michael R., Manufacturing Company Owner
Invoice Financing Eligibility Requirements
Understanding what providers look for can help improve your chances of approval.
Basic Requirements
- B2B or B2G business (you invoice other businesses or government entities)
- Minimum monthly invoice volume (typically $10,000+)
- Customers with good payment histories
- Invoices for completed work or delivered goods
- At least 3-6 months in business (varies by provider)
Documentation Needed
- Accounts receivable aging report
Shows all outstanding invoices and their ages
- Sample invoices
Examples of your typical customer invoices
- Business bank statements
Last 3-4 months of statements
Business bank statementsLast 3-4 months of statements
- Business formation documents
Articles of incorporation, EIN documentation
- Customer information
Details about your major customers
Understanding Invoice Financing Costs
Advance rates, discount fees, and other key terms that determine the total cost of your financing.
Advance Rate
The percentage of the invoice value you receive upfront, typically 70-90%.
Example: For a $10,000 invoice with an 80% advance rate
Initial advance: $8,000
The remaining balance (minus fees) is paid when your customer settles the invoice.
Discount Fee
The primary cost of invoice financing, typically 1-5% of the invoice value for the first 30 days.
• Typical range: 1-5% for first 30 days
• Additional fees for longer periods
• Based on customer creditworthiness and invoice volume
The discount fee is deducted from the reserve amount paid when your customer settles the invoice.
Additional Costs
Other potential fees to be aware of:
- Service fees (monthly administrative fees)
- Setup fees (one-time account establishment)
- Credit check fees (for customer verification)
- Wire transfer or ACH fees
Cost Example: Invoice Financing in Action
Let's look at a practical example to understand the total cost of invoice financing:
Example Calculation:
For a $10,000 invoice with an 80% advance rate and 3% discount fee:
- • Initial advance: $8,000 (80% of $10,000)
- • Discount fee: $300 (3% of $10,000)
- • Reserve amount: $2,000 (20% of $10,000)
- • Final payment upon customer payment: $1,700 ($2,000 - $300)
- • Total received: $9,700 ($8,000 + $1,700)
- • Total cost: $300 (3% of invoice value)
Lendec's AI Advantage:
Our AI technology calculates the estimated effective cost for each invoice financing offer based on your specific business's invoice payment patterns and customer creditworthiness. This helps you make informed comparisons between different financing options and understand the true cost of each offer.
Invoice Financing Application Process
Our AI-powered platform streamlines the invoice financing application process for faster funding.
AI-Powered Matching
Our AI analyzes your business profile, invoice history, and customer payment patterns to determine which financing providers are most likely to approve your application with favorable terms.
Document Upload
Upload your invoices, accounts receivable aging report, and business documents through our secure portal. Our system automatically organizes and verifies your documents to ensure a complete application.
Review & Approval
Financing providers review your application and typically provide an approval decision within hours. Our platform tracks the status of your application and provides real-time updates.
Funding
Once approved and you've accepted the offer, funding typically occurs within 24-48 hours via ACH transfer to your business bank account. You can then begin submitting invoices for financing immediately.
Ready to Improve Your Cash Flow?
Apply for invoice financing today and convert your unpaid invoices into immediate working capital.
Apply NowFrequently Asked Questions About Invoice Financing
Get answers to common questions about invoice financing and how our AI-powered platform can help.
Related Resources
Invoice Financing Calculator
Estimate your advance amount, fees, and total funding with our interactive calculator.
Try CalculatorFactoring vs. Discounting
Compare invoice factoring with invoice discounting to understand which option is best for your needs.
Read ComparisonSuccess Stories
Read how other businesses successfully used invoice financing to solve cash flow challenges and grow.
View Success Stories