Deciding between invoice factoring and a term loan

Pictured: Larry Baker of Shinault Baker CPA

We know that as a business owner, you might be wearing twelve different hats on any given day, and selecting the best business financing option might be daunting. Discount rates for invoice factoring can appear less expensive than a term loan, but make sure you calculate the APR. Overall, APRs for invoice factoring can sometimes be as high as 68%. Meanwhile, Funding Circle is here to deliver the business term loan options you need quickly, so you can focus on what&rsqou;s important – growing your business. We’re committed to offering:

Business term loans to:

Move or expand your space

Move or expand your space

Give your business room to grow with a bigger office, new location, or more warehouse space.
Refinance debt

Refinance debt

Convert high-interest debt into one monthly payment, with no prepayment penalties.
Buy inventory or equipment

Buy inventory or equipment

Invest in new equipment and fulfill every order through bulk inventory purchases.
Hire more employees

Hire more employees

Take your business to the next level by expanding your team and adding new skill sets.

Quick and easy to apply

  1. Apply online (in under 10 minutes)

    Submit your initial application in just a few clicks.

  2. Hear from us (within 1 hour)

    Your personal loan specialist is available to help you collect your documentation and answer any questions.

  3. Get a decision (in as little as 24 hours)

    Your underwriter will review your completed application and may call to get to know your business more.

  4. You get funded (in as few as 5 days)

    Once you’ve accepted your offer, you’ll receive the funds within days.

We’re here to help

You’ll get a dedicated account manager to guide you through every step.

Picture of a Funding Circle account managers who is here to guide you through the loan application process
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Give us a call!

Funding Circle, by far, impressed me more than any other lender I spoke to. They were immediately responsive and the process was so streamlined — it was a great experience.
Peter Koshland of Koshland Pharm

Invoice factoring: is it worth it?

Invoice factoring has its advantages, but convenience can come at a cost. Whether you’re looking for accounts receivable financing, freight factoring, or more, be sure to take the time to calculate the true cost of your financing options. A good lender will always be willing to help you calculate an APR (all costs for one year in a single equivalent interest rate), so that you can accurately compare the true cost of each loan. There&rsqou;s so much to consider when it comes to invoice factoring versus term loans. Let us help walk you through all the details.

Why Funding Circle

Funding Circle was created with a big idea: to revolutionize the outdated banking system and secure a better deal for small businesses. We passionately believe that when small businesses succeed, everyone benefits. To help your business thrive, we’ve taken the best parts of an SBA loan — like fixed and affordable once-monthly payments and no prepayment penalties — and created something faster and more flexible. From accountants and jewelers to bakers and filmmakers, we’ve helped thousands of businesses secure the financing they need to grow, create jobs, support local communities, and drive the economy forward.

reviews
I could not believe how simple, quick, easy, and competitive this loan turned out to be. The overall experience could not have been better!
David, February 2016

Frequently asked questions

Invoice factoring is when a business sells invoices to a factoring company at a discount in exchange for an upfront sum of money. The factoring company is then paid the amount of money due on the invoices — often in as little as 30 days. On the other hand, a term loan with a fixed rate means you have a consistent, once-monthly payment to make planning easier.
While the underwriting process at traditional banks can be clunky and opaque, Funding Circle delivers a best-in-class experience to our business customers. You’ll work with a dedicated loan specialist who will guide you through the entire application process and remain focused on meeting your unique financing needs. And we will never leave you waiting — you’ll have a decision from us in as little as 24 hours after document submission. We also deliver competitive rates, with no prepayment penalty or any other hidden fees.
Funding Circle’s application process is quick, easy, and transparent. You can apply for a loan and get a decision in as little as 24 hours after document submission.
We require a lien on your business assets and a personal guaranty from the primary business owners. Collateral can include, but is not limited to, equipment, vehicles, accounts receivable, and inventory.

Read, learn, and grow

Is it time to jumpstart your business? Get the inspiration you want and the knowledge you need to help your business thrive. Read advice from fellow entrepreneurs, financing tips, operating advice, and more on Funding Circle’s Resource Center.

Visit the Resource Center
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We’re here to help

Questions? Get in touch with our support team.

1 Rates may vary according to term and overall creditworthiness. To see what rate your business may qualify for, apply today at no obligation.