Payment up front is always ideal, but isn’t always possible. Invoice factoring can provide working capital in as little as 24 hours so your small businesses can fill in the gaps between issuing an invoice and receiving payment.
What is Invoice Factoring?
Invoice factoring is a non-loan form of funding called “accounts receivable financing” that enables businesses in Canada to access working capital in exchange for your unpaid invoices in as little as one business day. Your lender (that’s us) will purchase your business’s outstanding invoices at a discounted price and advance you the net amount in cash, typically between 70-90% of the invoice’s value up to $100,000 per common ownership. We can arrange online invoice factoring in bulk for your entire sales ledger, or for individual or small bundles of invoices.
With online invoice factoring with Greenbox Capital®, we are responsible for collecting on the invoice. Once your client makes payment, we’ll send you the remainder of the invoice’s value (minus our fee), with terms typically ranging between 30 and 90 days. We know how important your customer relationships are and you can trust us to collect on your invoice professionally.
Who Should Apply Online for Invoice Factoring?
Invoice factoring is ideal for:
- Businesses with long accounts receivable periods or large numbers of outstanding invoices
- Filling in cash flow gaps between sending invoices and receiving payment
- Invoices valued at $15,000+ with extended credit terms, and which are not more than 90 days past due
- Businesses seeking fast funding—invoice factoring can be deposited in as little as 1 business day
- B2C businesses that need smaller amounts of funding
- Businesses with lower credit scores or that do not have collateral, such as real estate and other major assets
Invoice factoring can benefit construction companies, pharmacies, law offices, manufacturers, business services, and more. No matter what industry you operate in, our expert Funding Advisors will work closely with you to select the best funding option to help you achieve your business’s goals without sacrificing cash flow.
How to Get Invoice Factoring in Canada
Gather 3 months of bank statements and other records. For faster approval, grant us secure access to your bank account’s transactional data.
A Funding Advisor will reach out to you within 1 hour (during regular business hours) to complete your application & discuss your funding options.
Once you and your Funding Advisor determine what funding option works for your business, your funds can be approved and deposited within 24 hours.
Payments will be automatically deducted from your business’s daily or weekly debit and credit card sales. Payment amounts will be based on your sales.
How to Use Invoice Factoring
There are no restrictions on how invoice factoring funding can be used. Funding received from online invoice factoring is typically best used to:
- Fill gaps in cash flow without committing to a long term loan.
- Cover recurring expenses like payroll, rent, utilities, and more while you wait for clients to pay their invoices in full.
- Fund growth strategies, new equipment, and other costly purchases that have a strong ROI.
- Take advantage of seasonal business opportunities such as purchasing inventory in bulk.
Invoice Factoring Qualification Requirements
Because your invoices essentially act as collateral, online invoice factoring has more flexible qualification requirements than other forms of funding.
Greenbox Capital focuses on the overall health of your business, not just your credit score, as well as the payment history of your customers. Here are some factors we consider:
- Business revenue
- Cash flow
- Vendor payment history
- Years in business
- Public records
We do not require first position on invoice factoring and no additional collateral is required.
Invoice Factoring Q&A
How do you determine which invoices to factor?
We review the customer you invoiced to verify their qualifications to pay the invoice. Once they are approved and the relationship is established, we buy all of your business’s outstanding invoices for that customer until either one of us ends the relationship with the customer.
Do you require a first position on invoice factoring?
We do not require first position on invoice factoring. However, most lenders do.
How will my customers know where to send payments?
We give your customer the payment information to wire to our business bank account, and will test beforehand to ensure payment is received properly. We are not a collections agency—we know how important your customer relationships are, and you can trust us to collect on your invoice professionally.
Is invoice factoring a loan?
No, invoice factoring is technically not a loan. Online invoice factoring is a form of asset purchase known as “accounts receivable financing”. There are multiple types of invoice factoring available, including invoice financing and invoice discounting. Learn more about how online invoice factoring works.
Will I pay interest with invoice factoring?
No, there are no interest payments with invoice factoring. Our fees are based on the difference between the value of the invoice and our purchase price, and will be clearly explained to you by one of our Funding Advisors.