Spot factoring

If your company offers 30 to 60-day payment terms to customers and you're having trouble waiting for cash, you can take advantage of spot factoring. It's a unique financing facility that funds a large portion of your invoices upfront and, in many cases, in as little as 24 hours.

Spot factoring companies can offer anywhere between 80-90% of your invoice amount upfront. The remaining balance, minus fees, is given to you once the customer pays the invoice. Unlike traditional factoring where you'd provide all your invoices for financing, spot factoring allows you to finance an individual invoice or a single batch of invoices.

Compare a range of invoice finance options

{"userFilters":[{"config":{},"dataSelector":{"recordType":"product","fieldCode":"GENERAL.PROVIDER_ID"},"dataType":"UUID","label":"Provider","order":100},{"config":{"MULTISELECT":true,"VALUES":"$0-10000, $10000-$20000, $20000-$30000, $30000-$40000, $40000-$50000, $50000 and above"},"dataSelector":{"recordType":"product","fieldCode":"TABLE_FILTER.BORROW_AMOUNT"},"dataType":"TEXT","label":"How much do you need to borrow?","order":null},{"config":{"MULTISELECT":true,"VALUES":"Haven\u2019t started yet, 0-6 months, 6-12 months, 1 to 2 years, 2 to 3 years, 3 years+"},"dataSelector":{"recordType":"product","fieldCode":"TABLE_FILTER.BUSINESS_AGE"},"dataType":"TEXT","label":"How old is your business?","order":null},{"config":{"MULTISELECT":true,"VALUES":"$0, $1 - $50000, $50000 - $100000, $100000 - $200000, $200000 - $300000, $300000+"},"dataSelector":{"recordType":"product","fieldCode":"TABLE_FILTER.BUSINESS_REVENUE"},"dataType":"TEXT","label":"How much does your business make per year?","order":null},{"config":{"MULTISELECT":true,"VALUES":"Secured, Unsecured"},"dataSelector":{"recordType":"product","fieldCode":"TABLE_FILTER.LOAN_SECURITY"},"dataType":"TEXT","label":"Loan Security","order":null},{"config":{"MULTISELECT":true,"VALUES":"1 month to 12 months, 1 to 2 years, 2 to 3 years, 3 to 4 years, 5 years and above"},"dataSelector":{"recordType":"product","fieldCode":"TABLE_FILTER.LOAN_TERM"},"dataType":"TEXT","label":"Loan Term","order":null}],"niche":{"currencySymbol":"$","decimalPoint":".","decimalPlaces":"2","thousandsSeparator":",","filterBoundsMap":{"product.GENERAL.PROVIDER_ID":null,"product.TABLE_FILTER.BORROW_AMOUNT":null,"product.TABLE_FILTER.BUSINESS_AGE":null,"product.TABLE_FILTER.BUSINESS_REVENUE":null,"product.TABLE_FILTER.LOAN_SECURITY":null,"product.TABLE_FILTER.LOAN_TERM":null}},"prefilled":false,"experimental":false}

20 of 38 results

Updated regularlyShare

Finder Score	Min. Loan Amount	Max. Loan Amount	Loan Term	Upfront Fee	Filter Values
Promoted Finder Score 9.5 Excellent Valiant Finance Business Loan Broker	Finder Score 9.5 Excellent	$5,000	$20,000,000	3 months to 7 years	$0 application fee		A Business Lending Specialist from Valiant Finance can give you access to competitive business loans from over 80 lenders. Loans between $5,000 and $20 million are available. Request a call – your loan can be funded in 1 business day.	Enquire nowMore info Compare product selection Compare	loading
Finder Score 7.9 Great ScotPac Invoice Finance	Finder Score 7.9 Great	$200,000	$150,000,000	1 to 2 years	Establishment fee 1% of the limit		Improve your business cash flow by financing your outstanding invoices. No minimum trading history required, but minimum 12 - month term and $200,000 in invoices.	Go to siteMore info Compare product selection Compare	loading
Finder Score 8.8 Great NAB Vehicle & Equipment Finance Offer	Finder Score 8.8 Great	$10,000	$150,000	1 to 5 years	$500 initial set up fee		Benefit from a low fixed rate and no upfront deposit to purchase vehicles and equipment for your business.	ContinueMore info Compare product selection Compare	loading
Finder Score 8.4 Great Stratton Finance Business Car Loan	Finder Score 8.4 Great	$10,000	$300,000	1 to 7 years	$482		A business vehicle loan for up to $300,000, with flexible contract terms and fast turnaround times.	ContinueMore info Compare product selection Compare	loading
Finder Score 8.2 Great NAB Vehicle & Equipment Finance	Finder Score 8.2 Great	$10,000	$150,000	1 to 5 years	$600 initial set up fee		Benefit from a low fixed rate and no upfront deposit to purchase vehicles and equipment for your business.	ContinueMore info Compare product selection Compare	loading
Finder Score 8 Great Swoop Finance Business Loan	Finder Score 8 Great	$5,000	$20,000,000	3 months to 30 years	Depending on your loan contract		Apply online and borrow between $5,000 and $20,000,000. Available to businesses with a minimum of 6 months operating history and have $20,000 in turnover.	ContinueMore info Compare product selection Compare	loading
Finder Score 7.7 Great Cash.com.au Commercial Finance	Finder Score 7.7 Great	$5,000	$500,000	3 months to 6 years	$0 application fee		You’ll receive a rate from 5.89% p.a. based on your circumstances. Both secured and unsecured business loans are available from $5,000 - $500,000, on terms of up to 5 years.	ContinueMore info Compare product selection Compare	loading
Finder Score 7.3 Great Funding Pro Invoice Finance	Finder Score 7.3 Great		No maximum amount	1 to 3 months			ContinueMore info Compare product selection Compare	loading
Finder Score 7.3 Great Funding Pro Invoice Discounting	Finder Score 7.3 Great		No maximum amount	1 to 3 months			ContinueMore info Compare product selection Compare	loading
Finder Score 7.2 Great Invoice Financing Australia	Finder Score 7.2 Great	$50,000	$5,000,000				ContinueMore info Compare product selection Compare	loading
Finder Score 7.1 Great Westpac Invoice Finance	Finder Score 7.1 Great	$500,000	No maximum amount				ContinueMore info Compare product selection Compare	loading
Finder Score 7 Great Single Invoice Finance	Finder Score 7 Great		No maximum amount		3 to 5%		ContinueMore info Compare product selection Compare	loading
Finder Score 7 Great Funding Pro Trade Finance	Finder Score 7 Great		No maximum amount	2 to 4 months	2% establishment fee		ContinueMore info Compare product selection Compare	loading
Finder Score 6.9 Standard Bigstone Asset Finance	Finder Score 6.9 Standard	$10,000	$2,000,000	1 to 5 years	$250		Borrow up to 100% of the value of your assets with no ongoing fees and the option for low doc finance.	ContinueMore info Compare product selection Compare	loading
Finder Score 6.6 Standard MiFinance ABN Loan	Finder Score 6.6 Standard	$100	$1,000	16 to 30 months	20%		ContinueMore info Compare product selection Compare	loading
Finder Score 6.5 Standard Cashflow Finance’s Debtor Finance	Finder Score 6.5 Standard		No maximum amount	1 to 3 months			ContinueMore info Compare product selection Compare	loading
Finder Score 6.4 Standard Cashflow Finance's Equipment Finance	Finder Score 6.4 Standard	$20,000	$500,000				ContinueMore info Compare product selection Compare	loading
Finder Score 6 Standard Earlypay Equipment Finance	Finder Score 6 Standard	$50,000	$1,500,000	2 to 5 years	$750 - Establishment fee		Upgrade or expand your business's equipment with equipment finance from Earlypay. Borrow from $50,000 to $1,500,000.	ContinueMore info Compare product selection Compare	loading
Finder Score 5.5 Standard Royal Finance Secured Business Loan	Finder Score 5.5 Standard	$50,000	$5,000,000	2 months to 1 year	depends on amount borrowed		Get access to a loan from $50,000 to $5,000,000 with Royal Finance. Standard loan terms range from 2 months to 1 year, extensions are also available.	ContinueMore info Compare product selection Compare	loading
Finder Score 5.5 Standard Fifo Capital Business Finance Business Loans	Finder Score 5.5 Standard		$350,000	3 to 18 months	Available on application		Borrow between and $350,000 with Fifo Capital who offer short approval times to support your business.	ContinueMore info Compare product selection Compare	loading

loading

Load More

Showing 20 of 38 results

Compare other products

We currently don't have that product, but here are others to consider:

How we picked these

Finder Score for business loans

We assess over 150 business loan products for their rates, fees and important features, assigning them a score out of 10.

Read the full methodology

How does spot factoring work?

Spot factoring can only be used by companies that provide 30- to 60-day payment terms to customers. It can be a source of funding to consider when you need quick access to cash for lumpy trading periods, unexpected growth opportunities or emergency situations such as making repairs or covering payroll.

First, spot factoring companies verify each invoice you submit by looking at the creditworthiness of the customer (called a "debtor') paying the invoice. The invoice must be payable within 30-60 days. Once you agree on fees and terms, you'll receive your funds at about 80% of the total invoice amount. The spot factoring company will also provide debt collection services.

Once your customer pays the invoice to the spot factoring company, you'll receive the remaining amount of the invoice (usually 20%), minus fees and charges.

How to compare spot factoring options

Here are the main points of difference when looking at spot factoring options:

• Advance rate. Also called a factor rate, this is the amount the spot factoring company will pay off your invoice and is expressed as a percentage. An 80% advance rate would mean you'd get 80% of the invoice amount upfront.
• Service fee. This is a one-time fee charged on every invoice you submit for financing. The fee is based on the total value of your invoice and can be anywhere from 0.1% to 20%.
• Discount rate. This is a fixed percentage rate charged on your advanced funds. It's calculated daily and charged every month. It can range from anywhere between 2% to 10% of the total amount advanced to you.
• Due diligence/document fees. These are initial setup costs for the spot factoring company to cover credit checks and other work needed to advance funds. These can be anywhere from a few hundred to a few thousand dollars.
• Other fees. There may be other ad hoc fees associated with your factoring facility. Make sure you're aware of all the fees associated with each option you're considering.

What are the pros and cons of spot factoring?

Is there anything to avoid?

Keep in mind the following pitfalls if you're considering spot factoring:

• Paying more than you can afford. Since spot factoring can be expensive, make sure you're fully aware of all fees and charges. Once you figure out the costs involved, conduct a cost-benefit analysis to see if you can afford it. Also, be aware of other traditional financing options such as short-term loans or a business line of credit.
• Using spot factoring as an ongoing source of funding. Because of the way spot factoring is set up and the costs associated with it, you should not use spot factoring if you have ongoing requirements for finance, such as on a monthly basis. Instead, use spot factoring when you urgently require funding for a one-off situation like taking advantage of a business opportunity or trying to make payroll.

FAQs about spot factoring

• How quickly can I access funds through spot factoring?

  Spot factoring is designed for fast funding. Once your invoices are approved, you can typically access up to 80–90% of their value within 24 to 48 hours, depending on your provider and customer verification processes. However, if it's your first time using the spot factoring provider it can take days or weeks to set up your account.

• Is spot factoring suitable for small businesses?

  Spot factoring can be a good fit for small businesses and startups that have limited cash flow or irregular invoice needs. It allows you to unlock working capital without taking on long-term debt or committing to a full invoice factoring facility.

• Will my customers know if I use spot factoring?

  That depends on whether you use a disclosed or undisclosed factoring arrangement. In disclosed factoring, your customers are notified that payments should go directly to the factoring company. In undisclosed factoring, your customers continue to pay you as usual, so they may not be aware of the arrangement.

• What fees are involved in spot factoring?

  Fees vary by provider but generally include a discount fee (a small percentage of the invoice value) and, in some cases, administration or setup fees. The cost is usually higher than traditional invoice factoring because you're using the service on a one-off basis rather than committing to an ongoing agreement.

• Can I choose which invoices to factor?

  Yes. One of the main advantages of spot factoring is flexibility. You can choose exactly which invoices to sell and when, giving you control over your cash flow without having to factor your entire sales ledger.

• How is spot factoring different from invoice financing?

  Spot factoring involves selling a single invoice to a factoring company to receive immediate cash, while invoice financing uses your unpaid invoices as collateral for a short-term loan. With factoring, the provider typically manages collections, whereas with invoice financing, you remain responsible for collecting payment.

• Are there industries that benefit most from spot factoring?

  Spot factoring is popular among industries with long payment cycles or project-based work, like transport, manufacturing, construction and professional services. It's particularly helpful for businesses that experience seasonal demand or rely on large invoices from a few key customers.

• Does spot factoring affect my credit rating?

  Because you're selling an asset (the invoice) rather than taking out a loan, spot factoring generally doesn't impact your business credit score. However, providers may still review your financial history and your customers' payment behaviour before approving your application.

• Can I stop using spot factoring at any time?

  Yes. Since spot factoring is a pay-as-you-go solution, there's no obligation to continue once you've settled your invoices. You can use it as often or as rarely as needed, making it a flexible option for short-term cash flow needs.

Written by

Elizabeth Barry

Journalist

Elizabeth Barry is an experienced journalist with over 10 years of expertise in personal finance, contributing to outlets like the ABC, Sydney Morning Herald, and 7News. She holds a Master of Arts in Creative Writing and a Bachelor of Arts in Communication from the University of Technology Sydney, and has earned multiple award nominations, including a Highly Commended recognition at the 2017 Lizzies. Elizabeth began her career at Finder in 2013, progressing through roles to become Lead Editor, where she oversaw a wide range of personal finance coverage until 2024. See full bio

Elizabeth's expertise

Elizabeth has written 202 Finder guides across topics including:

• Banking
• Personal finance
• Investing