$25K - $5M
AR Financing
Borrow against your accounts receivable without selling them. Maintain your customer relationships while accessing cash.
AR Financing
$25K - $5M
Overview
Accounts receivable financing lets you borrow against your outstanding invoices without selling them. Unlike factoring, you retain ownership of your receivables and maintain direct relationships with your customers — they'll never know you're using AR financing. The facility works like a revolving line of credit secured by your receivables, growing automatically as your AR grows. This makes it ideal for businesses with strong B2B customer relationships who need to accelerate cash flow without changing their collection process.
Key Features
- Borrow against receivables, retain ownership
- Revolving facility grows with your AR
- You maintain customer relationships
- Flexible advance rates
Funding Range
$25K - $5M
Category
Asset-Based Funding
Convert your business assets into the capital you need today.
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How AR Financing works
Set up your AR facility
We review your accounts receivable aging report and customer base to establish your borrowing capacity. The facility is structured as a revolving line secured by your receivables.
Submit invoices for borrowing
As you generate invoices, submit them to the lender to increase your available borrowing base. Advance rates typically range from 70-90% of eligible receivables.
Draw funds as needed
Borrow against your receivables at any time, up to your available borrowing base. Funds are transferred directly to your account, usually within one business day.
Repay as customers pay you
When your customers pay their invoices, those payments reduce your outstanding balance and free up capacity to borrow again. You handle all collections — your customers are unaware of the financing arrangement.
Why Choose This Product
Built for growing businesses
Keep Your Relationships
Your customers interact with you, not a third party. AR financing is invisible to your clients.
Revolving Access
As new receivables are created and old ones are collected, your borrowing capacity refreshes automatically.
Growth-Ready
The facility scales with your business. More receivables means more capital, with no need to renegotiate.
Eligibility
Who qualifies for AR Financing
- Minimum 500 credit score
- At least 4 months in business
- A portfolio of B2B or B2G receivables
- Minimum $5,000 in monthly bank deposits
- Invoices must be to creditworthy commercial or government customers
- Ideal for businesses with $25K+ in monthly receivables
Real-World Scenarios
Common use cases
A technology services firm with $500K in outstanding receivables borrows $350K against them to fund a new product launch, repaying as client payments clear over 60-90 days.
A janitorial services company uses AR financing to cover weekly payroll across multiple contracts, drawing against invoices as new jobs are completed and repaying as clients settle their monthly statements.
A distribution company accelerates cash flow by borrowing against its receivables during peak season, maintaining direct customer relationships while accessing the capital needed to fulfill large orders.
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AR Financing vs. alternatives
AR financing and factoring both convert receivables into cash, but the structures are fundamentally different. With AR financing, you borrow against your invoices and retain ownership — your customers never know. With factoring, you sell the invoices, and the factor collects directly from your customers. AR financing is better for businesses that value customer relationships and prefer to handle their own collections. A line of credit provides similar revolving access without tying to specific receivables, but may require stronger credit profiles. A term loan is more appropriate for one-time capital needs rather than ongoing cash flow management.
Frequently Asked Questions
Common questions about AR Financing
Most AR financing programs require a minimum credit score of 500. Like factoring, the creditworthiness of your customers is a significant factor in qualification and advance rates.
Initial setup typically takes 5-7 business days as the lender reviews your receivables and customer base. Once the facility is established, draws against new invoices are processed within one business day.
You will need an accounts receivable aging report, business bank statements, a customer list, and standard business identification. The lender will also review your invoicing and collection history.
With AR financing, you borrow against your invoices but keep ownership and handle collections yourself — your customers are unaware. With factoring, you sell the invoices to a third party who then collects from your customers directly. AR financing is typically preferred by businesses with strong customer relationships.
Yes, though AR financing facilities typically require a track record of invoicing. If you have at least 4 months of consistent receivables to creditworthy customers, you may qualify for an initial facility that grows as your business matures.
The initial application uses a soft credit inquiry. A hard pull may occur only when you finalize the facility agreement with a specific lender.
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