How Much Does Factoring Cost?

Accutrac’s factoring solutions are…Quick. Simple. Affordable.

Quick: Receive cash in as little as 24 hours of submitting an invoice, when you do business with credit-worthy customers.
Simple: It’s a simple process of selling your accounts receivables at a discount to Accutrac in exchange for immediate cash.
Affordable: Accutrac offers you the most competitive rates in the factoring industry.

ANNUAL RATES AS LOW AS PRIME PLUS 5.25% (*plus a small aadministration fee)

Accutrac Capital Solutions takes great pride in offering factoring solutions that are:

• customized to you and your business
• flexible to meet your unique financial needs and business circumstance

Invoice Factoring Costs

Factoring is not a business loan. It’s an alternative option…the only source of financing that automatically grows with your sales. Factoring rates are based on:

• whether we purchase your invoices on a recourse or non-recourse basis
• the size of your company
• the credit worthiness of your customer

How Rates are Calculated

The cost of factoring is broken down into two categories:

1. Administrative fees range from 0.5% to 2.0% of the invoice amount. They cover the costs of:
   • performing credit searches
   • collecting accounts receivable
   • processing paperwork
2. Financing fees cover the costs of advancing funds to you while Accutrac waits for payment from your client. They traditionally range from prime plus 5 to 7%.

The “Math” of Factoring:

How we calculated the Discount Fee:

 
*Assuming a prime rate of 3%, Accutrac’s Financing Rate would be 8% (3% + 5%), or 0.0% per day. Actual fees will depend on the current prime rate when factoring takes place.

Factoring is a simple process of selling your accounts receivables at a discount. Accutrac advances 90% of the invoice face value. Accutrac waits to be paid by your customer, and then remits the 10% balance to you, minus a small service fee. Service fees are based on invoice amounts and the time to complete the transaction.

Factoring Can Reduce Costs:

Factoring lets you avoid costly expenses while you’re waiting for customers to pay. Some of these include:

• late penalties for bills due
• missing out on early payment or bulk purchase discounts from vendors
• fees charged when paying for supplies with credit cards
• labour costs for checking credit scores and chasing receivables
• the costs of a tarnished credit score

For many businesses, the small fee paid for factoring is often less than these combined costs.