ACCOUNTS RECEIVABLE FINANCING

Funding Amount

$250K to $15M

Asset-Backed

Based on receivable value

Time to Fund

2 weeks to 3 months

What is it?

Use what you’re owed to fuel what’s next

Accounts receivable financing is a great way to cover cash flow gaps by offering unpaid invoices as collateral.

Businesses can leverage their outstanding invoices for access to funding through a line of credit or loan. Instead of waiting weeks or months for payments, you can unlock the value of your receivables and access the capital you need today.

Not looking to use receivables as collateral?LoanGIANT also offers flexible cash flow-based funding with fast approvals and no asset requirements.

how does it work?

Types of accounts receivable financing

Immediate cash flow from financing can come in two primary forms with AR financing: a loan backed by your AR, or factoring, where you sell your invoices at a discount for upfront cash. Both preserve cash flow, support growth, and meet time-sensitive expenses without taking on new debt.

Accounts receivable loan

You keep ownership of the invoices and repay a loan that uses them as collateral. You collect from customers and manage the payment timeline.

Invoice factoring

You sell your invoices to a factoring company at a discount. They advance a portion of the invoice value upfront, between 70% – 90%, and handle collections. Afterwards, you receive the remaining balance, minus fees.

Other formats include:

• Recourse factoring: You buy back invoices the factor can’t collect
• Non-recourse factoring: The factor assumes collection risk
• Spot factoring: Finance one-time invoices only
• Invoice discounting: Private credit line using AR as backing

What’s the difference?

AR Financing vs. Factoring

Factor	AR Financing	Invoice Factoring
Invoice control	Retained by business	Handled by factoring company
Risk	On the business	Shared or transferred, depending on structure
Cost	Lower fees and interest	Higher flat-rate fees
Customer experience	You handle communications	Customers deal with the factor

How does it work?

When choosing between AR or a revolving line of credit, the AR financing option might seem slightly more complex, but the process is quite simple.

• Submit your unpaid invoices to as collateral.
• You’re presented with a funding offer based on the value of your invoices.
• If you accept, you collaborate to establish a fee structure.
• Funds are released, then you begin repaying according to the agreed terms.

Pros & cons

Benefits

• Quick access to cash: No more waiting on net 30, 60, or 90 payment terms
• Flexible approval: Based on your customers’ credit, not just yours
• Collateral-light: Your invoices secure the funds—no hard assets needed
• Fast and easy: Fewer documents and faster turnaround than traditional loans

Considerations

• Cost can add up: Fees may exceed traditional financing if used frequently
• Customer optics: Factoring may raise concerns if customers prefer direct communication
• Receivables quality: Poor payment history or disputed invoices can limit funding