Invoice Factoring Calculator
Use our free online calculator to see how easy you can access working capital when you factor invoices.
How to Use our Invoice Factoring Calculator
Plug in numbers on each of the 3 lines. The calculator simulates how you can quickly increase cash flow for your company.
(Note: all line-items must be complete in order for the calculator work properly).
Refer to our key terms for further definitions and additional information.
Key Invoice Factoring Terms
Accounts Receivable: The amount of money owed to you by your customers for goods or services delivered.
Factoring Rate: The rate charged by the factor to purchase your unpaid invoices.
Most factors offer rates between 2-5% (some are less, some are more). This is based upon factoring volume, customer payment terms, and average invoice size.
Advance Rate: The percentage of the invoice that is paid on the date of invoice purchase. (Advance Rate x Invoice Price = Advance Amount).
Reserve Amount: The remaining amount of the invoice price held by the factoring company until your customer pays. When payment is received, the reserve amount is forwarded back to you.
Example: If you have a $1,000 invoice with a Factoring Rate of 3%, and an Advance Rate of 90%, then you would receive $900 at the time of invoice purchase and an additional $70 when the invoice is paid by your customer ($970 total). The factoring company would receive $30 (3% of invoice price).