Invoice Factoring Calculator

Nearly every invoice factoring calculator online belongs to a factoring company or a broker, and they all run the same small sum: invoice amount, times a fee rate, times an advance rate. That gives you a rough cost for one invoice. It leaves out the two things that actually cause problems.

The first is timing. Factoring pays you twice, not once: an advance now, then the rest of the invoice — the reserve — minus fees, whenever your customer finally pays. Those are two separate cash events, often two months apart. A forecast that treats a factored invoice as one lump sum on the due date is wrong in both amount and date.

The second is the recourse clock. Once an invoice is factored you have a deadline. If your customer hasn't paid within the recourse period, that invoice charges back: it leaves your borrowing base, your availability drops, and often the advance is recovered from your reserve or your next funding. Nothing bounces — the number in the portal just changes. The tracker tab rebuilds that math from your own ledger so you see it coming.

Most small businesses already run a cash flow forecast in their accounting software, and for a business without a facility it works fine. Feed it your A/R and it draws a projected bank balance: money in, money out, a line you can read, and a warning when you go below zero. That format is the right one — it answers the question owners actually ask, which is "will I make payroll?"

The problem is what those forecasters do with a factored invoice. They take the invoice amount and drop it on the due date, because that is all the A/R aging tells them. For anyone factoring, that is wrong twice. Wrong in amount, because you never receive the invoice amount — you receive an advance of 80% to 95% now, then the reserve minus fees later. And wrong in date, because that second payment lands when your customer actually pays, not when the invoice was due.

On a $60,000 invoice at an 85% advance rate, a due-date forecaster shows $60,000 arriving on day 45. Reality is $51,000 already funded and roughly $7,000 arriving on day 68 or whenever that customer really pays. The forecast overstates that month by about $53,000 and understates the prior one by the same amount. If the customer runs past the recourse window it is worse: the advance charges back and the line moves the other way.

The forecast tab here keeps the format and fixes the model. Enter your bank balance, add your outgoings, and it splits every factored invoice into advance and reserve rebate, dates the rebate from each customer's real average days-to-pay, applies a chargeback when payment is expected after the recourse date, and pays non-factored invoices in full direct to your bank. Same chart your bookkeeper expects, numbers you can rely on.

Most factoring in the US is recourse factoring. That means you carry the credit risk: if your customer doesn't pay within the recourse window, you buy the invoice back or the factor recovers the advance from your reserve.

Non-recourse factoring shifts some of that risk to the factor, but read what it actually covers. It's usually limited to your customer becoming formally insolvent during the term — not to your customer simply refusing to pay, disputing the work, or paying six months late. Non-recourse also carries a higher fee for that narrower protection.

So whichever you're on, slow payment remains your problem, and the recourse date is the one to watch. The board in the tracker sorts your invoices by how soon they charge back and shows the funding at stake for each.

Most US factors quote a fee as a percentage of the invoice amount, typically 1% to 5%, and it comes in one of two shapes.

A flat fee is one charge regardless of when your customer pays. Simple, and it protects you if they're slow.

A tiered fee is charged per 30-day period the invoice stays open — say 1.5% for the first 30 days, another 1.5% for days 31 to 60, and so on. The trap is that most agreements charge per started period, not pro rata: an invoice paid on day 31 costs the same as one paid on day 60. The calculator models it that way, so you can see the cliff edge. If your customers habitually pay at day 32, a flat fee may well be cheaper than a tiered one that looks lower on paper.

Then there are the add-ons that don't appear in the headline rate: wire fees ($15–$35 per transfer, which matters a lot on small invoices), ACH fees, application and UCC filing fees, monthly minimums, and — the one that bites — monthly volume minimums with termination penalties. Put your per-transfer charge into the fixed-charges box to see the real cost.

A 1.5% fee reads as cheap next to a line of credit at 11% a year. They're not comparable: the 1.5% buys about 30 to 45 days of money, the 11% buys a year of it.

To compare, annualize. Take your total fees, divide by the cash you actually received, then scale by 365 divided by the days outstanding. Factoring a $50,000 invoice for $750 in fees against a $42,500 advance over 45 days costs 1.5% of the invoice — but roughly 14% a year. Move the same invoice to a 60-day payment and a second fee period, and it's about 21% a year.

That's not an argument against factoring. It's often the right decision: it scales with your sales, it approves on your customers' credit rather than yours, and it can fund a payroll a bank line wouldn't reach in time. But you should know which number you're comparing to what, and this is the only free calculator we've found that shows it.

Your availability isn't your receivables times the advance rate, which is why the portal figure so often reads low. It's a sequence of deductions, applied in this order:

Start with your open factored invoices. Remove the ineligibles — anything past the recourse period, invoices in dispute, and depending on your agreement, foreign debtors, affiliate invoices, or customers over their approved credit limit. What's left is your eligible receivables.

Now apply the concentration limit. Most facilities cap how much of the borrowing base a single customer can represent, commonly 25% to 50%. If your eligible receivables are $100,000, the cap is 50%, and one customer owes $60,000, then $10,000 of that balance is excluded. Critically, the cap applies to the ledger after ineligibles are removed — so an aged invoice from an unrelated customer can shrink the base and push your biggest customer over the cap.

Multiply the survivor by your advance rate for gross availability, cap that at your facility limit, then subtract funds in use. That's what you can draw today. The tracker itemizes every line with its reason — the part your account statement leaves you to reverse-engineer.

Read customer reviews of any large factor and the same theme dominates: reserves held back longer than expected, released without explanation, or still outstanding months after a company left the facility. Reserve balances are where the disputes are.

Part of the reason is that a reserve isn't one pot. Every factored invoice has its own reserve, released at its own time, net of fees that may still be accruing — and chargebacks are often netted against reserves rather than billed. Very few businesses track it invoice by invoice, so when the total doesn't match expectations there's no way to argue the point.

The tracker treats each invoice's reserve as its own dated cash event, so you can see what should be released, when, and what a chargeback would take out. When your statement disagrees, you have a line-by-line position to query rather than a feeling that something's off.

There's no login, no bank feed and no accounting integration here — and a bank feed wouldn't answer these questions anyway. What arrives in your account is factor remittances, in lump sums that don't map to individual invoices. The datasets that answer the real questions are your A/R ledger and your funds-in-use figure.

So: enter your facility terms once from your agreement, import your open invoices from a QuickBooks, Xero or NetSuite CSV export (upload and pick which column is which), and type in your current funds in use. Mark invoices paid as they settle — a few minutes a week — and you get availability, recourse deadlines and a forward cash curve.

It also learns your customers. Once a few invoices are marked paid, the tool calculates each customer's real average days-to-pay and forecasts on that instead of stated terms — so a customer who reliably pays at day 68 on net-30 gets forecast at 68, which is the difference between a forecast you can bank on and one you can't. Everything stays in this browser; use the backup button to move it between devices.